Merchants Bancorp (MBIN) 10-K 15 Mar 19 2018 FY Annual report Financial data

Document and Entity Information

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Mar. 08, 2019	Jun. 30, 2018
Document and Entity Information
Entity Registrant Name	Merchants Bancorp
Entity Central Index Key	0001629019
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Public Float			$ 460.9
Entity Common Stock, Shares Outstanding		28,704,163
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Assets
Cash and due from banks	$ 25,855	$ 18,905
Interest-earning demand accounts	310,669	340,614
Cash and cash equivalents	336,524	359,519
Securities purchased under agreements to resell	6,875	7,043
Trading securities	163,419	140,837
Available for sale securities	331,071	408,371
Federal Home Loan Bank (FHLB) stock	7,974	7,539
Loans held for sale (includes $11,886 at fair value for 2018)	832,455	995,319
Loans receivable, net of allowance for loan losses of $12,704, and $8,311, respectively	2,045,423	1,366,349
Premises and equipment, net	15,136	5,354
Mortgage servicing rights	77,844	66,079
Interest receivable	13,827	8,326
Goodwill	17,477	3,902
Intangible assets, net	3,542	1,512
Other assets and receivables	32,596	22,983
Total assets	3,884,163	3,393,133
Deposits
Noninterest-bearing	182,879	620,700
Interest-bearing	3,048,207	2,322,861
Total deposits	3,231,086	2,943,561
Borrowings	195,453	56,612
Deferred and current tax liabilities, net	15,444	12,422
Other liabilities	20,943	13,064
Total liabilities	3,462,926	3,025,659
Commitments and Contingencies
Shareholders' Equity
Common stock, without par value, Authorized - 50,000,000 shares, Issued and outstanding - 28,694,036 shares at December 31, 2018 and 28,685,167 shares at December 31, 2017	135,057	134,891
Preferred stock - $1,000 per share, without par value, Authorized - 5,000,000 shares, Issued and outstanding - 41,625 shares	41,581	41,581
Retained earnings	244,909	192,008
Accumulated other comprehensive loss	(310)	(1,006)
Total shareholders' equity	421,237	367,474
Total liabilities and shareholders' equity	$ 3,884,163	$ 3,393,133

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Loans held for sale at fair value	$ 11,886
Allowance for loans receivable	$ 12,704	$ 8,311
Stockholders' Equity:
Common stock, without par value (in dollars per share)
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	28,694,036	28,685,167
Common stock, shares outstanding	28,694,036	28,685,167
Preferred stock, stated value (in dollars per share)	$ 1,000	$ 1,000
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	41,625	41,625
Preferred stock, shares outstanding	41,625	41,625

Consolidated Statements of Inco

Consolidated Statements of Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Interest Income
Loans	$ 119,457	$ 79,922	$ 62,563
Investment securities:
Trading	5,012	5,187	4,516
Available for sale	6,448	4,531	3,249
Federal Home Loan Bank stock	385	321	320
Other	9,261	4,426	2,291
Total interest income	140,563	94,387	72,939
Interest Expense
Deposits	42,216	20,003	11,663
Borrowed funds	8,376	7,787	7,305
Total interest expense	50,592	27,790	18,968
Net interest income	89,971	66,597	53,971
Provision for loan losses	4,629	2,472	960
Net Interest Income After Provision for Loan Losses	85,342	64,125	53,011
Noninterest Income
Gain on sale of loans	39,266	37,790	24,755
Loan servicing fees, net	5,741	6,273	280
Mortgage warehouse fees	2,550	2,608	3,015
Gains on sale of investments available for sale related to accumulated other comprehensive earnings reclassifications			24
Other income	2,028	1,009	430
Total noninterest income	49,585	47,680	28,504
Noninterest Expense
Salaries and employee benefits	32,240	21,472	14,313
Loan expenses	4,621	4,097	4,251
Occupancy and equipment	2,788	1,602	1,344
Professional fees	2,585	1,516	1,298
Deposit insurance expense	1,024	930	1,149
Technology expense	1,544	1,171	985
Other expense	6,098	3,856	3,380
Total noninterest expense	50,900	34,644	26,720
Income Before Income Taxes	84,027	77,161	54,795
Provision for income taxes	21,153	22,477	21,668
Net Income	62,874	54,684	33,127
Dividends on preferred stock	(3,330)	(3,330)	(2,002)
Net Income Allocated to Common Shareholders	$ 59,544	$ 51,354	$ 31,125
Basic Earnings Per Share (in dollar per share)	$ 2.08	$ 2.28	$ 1.47
Diluted Earnings Per Share (in dollar per share)	$ 2.07	$ 2.28	$ 1.47
Weighted-Average Shares Outstanding Basic (in Shares)	28,692,955	22,551,452	21,111,208
Weighted-Average Shares Outstanding Diluted (in Shares)	28,724,419	22,568,154	21,113,435

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Consolidated Statements of Comprehensive Income
Net Income	$ 62,874	$ 54,684	$ 33,127
Other Comprehensive Income (Loss):
Net change in unrealized losses on investment securities available for sale, net of (taxes) benefits of $(294), $256, and $262 respectively	939	(378)	(382)
Less: Reclassification adjustment for gains included in net income, net of $10 tax expense in 2016			14
Other comprehensive income (loss) for the period	939	(378)	(396)
Comprehensive Income	$ 63,813	$ 54,306	$ 32,731

Consolidated Statements of Co_2

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Consolidated Statements of Comprehensive Income
Net change in unrealized losses on investment securities available for sale, (taxes) benefits	$ (294)	$ 256	$ 262
Reclassification adjustment for gains included in net income, tax expense			$ 10

Consolidated Statement of Share

Consolidated Statement of Shareholders' Equity - USD ($) $ in Thousands	Common StockIPO	Common Stock	Preferred StockPrivate Placement	Preferred Stock	Retained Earnings	Accumulated Other Comprehensive Income (Loss)	Private Placement	IPO	Total
Balance at beginning of the period at Dec. 31, 2015		$ 20,061		$ 10,000	$ 118,371	$ (232)			$ 148,200
Balance at beginning of the period (in shares) at Dec. 31, 2015		21,111,200		10,000
Condensed Consolidated Statements of Shareholders’ Equity
Net income					33,127				33,127
Shares issued			$ 31,581				$ 31,581
Shares issued (in shares)			31,625
Dividends on preferred stock, $80.00 per share					(2,002)				(2,002)
Dividends on common stock, $0.24, $0.20 and $0.20 per share for the year ended 2018, 2017 and 2016 respectively					(4,222)				(4,222)
Other comprehensive income (loss)						(396)			(396)
Balance at end of the period at Dec. 31, 2016		$ 20,061		$ 41,581	145,274	(628)			206,288
Balance at end of the period (in shares) at Dec. 31, 2016		21,111,200		41,625
Condensed Consolidated Statements of Shareholders’ Equity
Net income					54,684				54,684
Shares issued	$ 106,245							$ 106,245
Shares issued (in shares)	7,187,500
Shares issued for stock compensation plans		$ 458							458
Shares issued for stock compensation plans (in shares)		3,196
Shares issued for MCS acquisition		$ 8,127							8,127
Shares issued for MCS acquisition (in shares)		383,271
Dividends on preferred stock, $80.00 per share					(3,330)				(3,330)
Dividends on common stock, $0.24, $0.20 and $0.20 per share for the year ended 2018, 2017 and 2016 respectively					(4,620)				(4,620)
Other comprehensive income (loss)						(378)			(378)
Balance at end of the period at Dec. 31, 2017		$ 134,891		$ 41,581	192,008	(1,006)			367,474
Balance at end of the period (in shares) at Dec. 31, 2017		28,685,167		41,625
Condensed Consolidated Statements of Shareholders’ Equity
Net income					62,874				62,874
Shares issued for stock compensation plans		$ 166							166
Shares issued for stock compensation plans (in shares)		8,869
Dividends on preferred stock, $80.00 per share					(3,330)				(3,330)
Dividends on common stock, $0.24, $0.20 and $0.20 per share for the year ended 2018, 2017 and 2016 respectively					(6,886)				(6,886)
Reclassification of deferred tax asset due to tax reform					243	(243)
Other comprehensive income (loss)						939			939
Balance at end of the period at Dec. 31, 2018		$ 135,057		$ 41,581	$ 244,909	$ (310)			$ 421,237
Balance at end of the period (in shares) at Dec. 31, 2018		28,694,036		41,625

Consolidated Statement of Sha_2

Consolidated Statement of Shareholders’ Equity (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Dividends on preferred stock per share	$ 80	$ 80	$ 80
Dividends on common stock per share	$ 0.24	$ 0.20
Preferred Stock
Offering expenses on issuance of stock			$ 44

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Operating activities:
Net income	$ 62,874	$ 54,684	$ 33,127
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	461	296	278
Provision for loan losses	4,629	2,472	960
Deferred income tax, net	2,313	(2,415)	(1,436)
Gain on sale of securities			(24)
Gain on sale of loans	(39,266)	(37,790)	(24,755)
Proceeds from sales of loans	18,027,460	18,498,028	20,022,010
Loans and participations originated and purchased for sale	(17,832,035)	(18,702,694)	(20,145,855)
Change in mortgage servicing rights for paydowns and fair value adjustments	2,348	2,554	7,628
Net change in:
Trading securities	(22,582)	(3,162)	(29,806)
Other assets and receivables	(10,023)	11,501	(16,170)
Other liabilities	3,419	(850)	4,073
Other	3,992	1,490	199
Net cash provided by operating activities	203,590	(175,886)	(149,771)
Investing activities:
Net change in securities purchased under agreements to resell	168	(1,651)	122
Purchases of available-for-sale securities	(47,040)	(199,635)	(290,396)
Proceeds from the sale of available-for-sale securities	6,431	0	7,371
Proceeds from calls, maturities and paydowns of available-for-sale securities	188,252	116,506	210,967
Purchases of loans	(138,965)	(133,329)	(75,249)
Net change in loans receivable	(484,102)	(300,889)	(119,075)
Proceeds from sale of home equity loans held for investment			14,900
Purchase of Federal Home Loan Bank stock	(956)
Proceeds from sale of Federal Home Loan Bank stock	700
Proceeds from sale of assets	10		40
Purchases of premises and equipment	(9,195)	(788)	(1,204)
Purchases of mortgage servicing rights	(6,313)	(1,209)	(1,357)
Purchase of limited partnership interests	(3,810)	(2,694)	(11,126)
Cash (paid) received in acquisition of subsidiary	(14,320)	363
Other investing activities	74	189	(295)
Net cash used in investing activities	(509,066)	(523,137)	(265,302)
Financing activities:
Net change in deposits	155,002	514,940	389,101
Proceeds from Federal Home Loan Bank borrowings	1,089,107	754,150	220,000
Repayment of Federal Home Loan Bank borrowings	(931,994)	(754,544)	(220,485)
Proceeds from issuance of common stock		106,245
Proceeds from issuance of preferred stock			31,581
Proceeds from notes payable	19,116
Payments on notes payable	(38,534)
Dividends	(10,216)	(7,950)	(6,224)
Net cash provided by financing activities	282,481	612,841	413,973
Net Change in Cash and Cash Equivalents	(22,995)	(86,182)	(1,100)
Cash and Cash Equivalents, Beginning of Period	359,519	445,701	446,801
Cash and Cash Equivalents, End of Period	336,524	359,519	445,701
Additional Cash Flows Information:
Interest paid	49,276	26,763	17,799
Income taxes paid	16,965	27,050	$ 22,230
The Company purchased all of the capital stock of FMBI on January 2, 2018, the capital stock of FMNBP on October 1, 2018, and the assets of NattyMac, LLC on December 31, 2018. The Company also purchased all of the capital stock for MCS on August 15, 2017. In conjunction with the acquisitions, liabilities were assumed as follows:
Fair value of assets acquired	168,153	12,666
Cash paid for the capital stock/fair value common stock issued	29,872	8,127
Fair value of liabilities assumed	$ 138,281	$ 4,539

Nature of Operations and Summar

Nature of Operations and Summary of Significant Accounting Policies	12 Months Ended
	Dec. 31, 2018
Nature of Operations and Summary of Significant Accounting Policies
Nature of Operations and Summary of Significant Accounting Policies	Note 1: Nature of Operations and Summary of Significant Accounting Policies Nature of Operations and Principles of Consolidation The accompanying consolidated financial statements include the accounts of Merchants Bancorp, a registered bank holding company (the “Company”) and its wholly owned subsidiaries, Merchants Bank of Indiana (“Merchants Bank”) and Farmers-Merchants Bank of Illinois (“FMBI,” formerly Joy State Bank prior to October 22, 2018). Merchants Bank’s direct and indirect subsidiaries include Merchants Capital Corp. (“MCC,” formerly P/R Mortgage and Investment Corp prior to October 1, 2018), Merchants Capital Servicing, LLC (“MCS,” formerly RICHMAC Funding, LLC prior to November 1, 2018), Ash Realty Holdings, LLC (“Ash Realty”), MBI Midtown West, LLC (“MMW”), Natty Mac Funding, Inc. (“NMF”), and OneTrust Funding, Inc. The Company also acquired Farmers-Merchants National Bank of Paxton (‘FMNBP”) on October 1, 2018 through a merger with FMBI, with FMBI as the surviving entity. All these entities are collectively referred to as the “Company”. All significant intercompany accounts and transactions have been eliminated in consolidation. Merchants Bank operates under an Indiana state bank charter and provides full banking services. As a state bank and non-Federal Reserve member, it is subject to the regulation of the Indiana Department of Financial Institutions (“IDFI”) and the Federal Deposit Insurance Corporation (“FDIC”). The Company is further subject to regulations of the Board of Governors of the Federal Reserve System (“Federal Reserve”) governing bank holding companies. Merchants Bank operates from four locations in Indiana, including Lynn, Spartanburg, Carmel and Indianapolis. Merchants Bank generates commercial, mortgage and consumer loans and receives deposits from customers located primarily in Hamilton, Randolph and surrounding counties in Indiana. Merchants Bank’s loans are generally secured by specific items of collateral including real property, consumer assets and business assets. Merchants Bank’s Mortgage Warehousing segment funds and participates in single family and multi‑family, agency eligible loans across the nation. FMBI operates under an Illinois state bank charter and provides full banking services. As a state bank and non-Federal Reserve member, it is subject to the regulation of the Illinois Department of Financial and Professional Regulation (“IDFPR”) and the FDIC. FMBI operates from five locations in Illinois, including Joy, New Boston, Paxton, Melvin, and Piper City. MCC was formed in August 1990, in the state of Indiana. MCC is primarily engaged in mortgage banking, specializing in lending for multi‑family rental properties and healthcare facilities. It is an FHA approved mortgagee and a Ginnie Mae, Fannie Mae, and Freddie Mac issuer. In August 2012, Merchants Bank established a qualifying subsidiary, Ash Realty, for the purpose of acquiring, holding and liquidating real estate acquired by Merchants Bank as a result of various foreclosures. NMF was formed in April 2014, in the state of Indiana. Prior to the Company acquiring all the assets of NattyMac Funding, LLC from Home Point Financial Corporation (“Home Point”) on December 31, 2018, NMF provided loan participations and participation warehouse financing to Home Point, its subsidiaries, and customers. MMW was formed in 2016 to hold land and improvements for the Company’s new headquarters building that is expected to be complete in the summer of 2019. OneTrust Funding, Inc. was formed in April 2018, in the state of Indiana, to facilitate warehouse financing arrangements, similar to those between NMF and Home Point. Recent Acquisitions On August 15, 2017, Merchants Bank acquired 100% of the equity interests of MCS (formerly RICHMAC Funding, LLC), which was a national multi-family housing mortgage lender and servicer. The purchase price was paid in shares of Company common stock with a value of $8.1 million. As of December 31, 2018, the Company recorded goodwill and intangible assets totaling $3.8 million and $1.6 million, respectively, in connection with the acquisition. As a result of the acquisition, the Company expanded its product offerings and benefited from economies of scale. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. On May 8, 2017, the Company entered into a Stock Purchase Agreement to acquire FMBI (formerly Joy State Bank). The acquisition closed on January 2, 2018 at a total cost of approximately $5.5 million. At December 31, 2017 Joy State Bank had $43 million in assets. The Company recorded goodwill and intangible assets totaling $988,000 and $478,000, respectively, in connection with the acquisition. The intangible assets consisted of core deposit intangibles that are being amortized over 10 years on an accelerated basis. The acquired time deposits of $16.7 million were recorded at a fair value of $16.9 million. The fair value premium of $185,000 is being accreted against interest expense over 20 months. The acquired loan portfolio of $27.9 million was recorded at a fair value of $27.5 million. The fair value discount of $458,000 is being accreted to interest income on a straight-line basis over an average of 39 months in accordance with ASC 310-20. While there were some loans identified for potential classification under ASC 310-30, they were not material to the transaction. On October 22, 2018, the Company changed the name of Joy State Bank to Farmers-Merchants Bank of Illinois (“FMBI”). Certain fair value measurements and the purchase price allocation are still being evaluated by management and are subject to change during the measurement period. As a result of the acquisition, the Company increased its deposit base and benefited from economies of scale. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. On October 1, 2018, the Company acquired FM Bancorp, Inc., a bank holding company, and its wholly owned subsidiary, Farmers-Merchants National Bank of Paxton (“FMNBP”). On that date, FM Bancorp, Inc. ultimately merged with and into the Company, with the Company as the surviving entity, and FMNBP merged with and into Joy State Bank, with Joy State Bank as the surviving bank. Effective October 22, 2018, Joy State Bank’s name changed to Farmers-Merchants Bank of Illinois (“FMBI”). Under the terms of the merger agreement, shareholders of the 27,537 outstanding shares of FM Bancorp, Inc. were compensated $795.29 per share, for a total purchase price of $21.9 million. As of September 30, 2018, FM Bancorp, Inc. and Farmers-Merchants National Bank of Paxton had total assets of approximately $110.0 million, available for sale securities of $66.3 million, deposits of approximately $95.7 million, and net loan receivables of approximately $35.0 million. The Company recorded goodwill and intangible assets totaling $7.2 million and $1.9 million. The intangible assets consisted of core deposit intangibles that are being amortized over 10 years on an accelerated basis. The acquired available for sale securities of $66.3 million were recorded at fair value. A fair value discount associated with securities of $1.0 million is being accreted into interest income, in accordance with ASC 310-20. While there were some loans identified for potential classification under ASC 310-30, they were not material to the transaction. The acquired gross loan portfolio of $35.4 million was recorded at a fair value of $34.8 million. The fair value discount of $625,000 includes a discount related to interest assumptions for $279,000 and to credit assumptions for $346,000. The portion related to interest assumptions is being accreted into interest income on a straight-line basis over an average of 72 months in accordance with ASC 310-20. The discount portion related to credit assumptions is being accreted into interest income over the life of the loan. The acquired deposits of $95.7 million were recorded at a fair value of $95.7 million. Certain fair value measurements and the purchase price allocation are still being evaluated by management and are subject to change during the measurement period. As a result of the acquisition, the Company increased its deposit base and benefited from economies of scale. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. On December 31, 2018, the Company acquired the assets of NattyMac, LLC, a warehouse lender operating out of Clearwater, Florida, from Home Point Financial Corporation (“Home Point”). The Company also fully repaid Home Point the balance of, and all interest owed on, the $30 million subordinated debt it had previously invested in the Company. Goodwill totaling $5.0 million was recorded by the Company. Certain fair value measurements, intangibles, and the purchase price allocation are still being evaluated by management and are subject to change during the measurement period. As a result of the acquisition, the Company expects to increase its geographic footprint in the warehouse business, reduce its costs of borrowing, increase the earnings generated from its warehouse business, and benefit from its experienced talent pool. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. Given the impact of the acquisitions was immaterial to the Company and its results of operations, pro forma information has not been included. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, loan servicing rights and fair values of financial instruments. Cash and Cash Equivalents The Company considers all liquid investments with original maturities of three months or less to be cash equivalents. Cash equivalents consist primarily of cash amounts due from depository institutions, interest‑bearing deposits in other banks, money market accounts, and federal funds sold. At December 31, 2018, the Company’s cash accounts exceeded federally insured limits by approximately $331.2 million. Included in this amount is approximately $295.4 million with the Federal Reserve Bank, $12.9 million with the Federal Home Loan Bank of Indianapolis, and $15,000 with the Federal Home Loan Bank of Chicago. At December 31, 2017, the Company’s cash accounts exceeded federally insured limits by approximately $349.4 million. Included in this amount is approximately $327.4 million with the Federal Reserve Bank and $3.5 million with the Federal Home Loan Bank of Indianapolis. Securities purchased under agreements to resell Securities purchased pursuant to a simultaneous agreement (RRA) to resell the same securities at a specified price and date generally have maturity dates of 90 days or less and are carried at cost. Every 90 days the RRAs rollover. Trading Activities The Company engages in trading activities. Securities that are held principally for resale in the near term are recorded in the trading assets account at fair value with changes in fair value recorded in earnings. Trading securities include FHA and conventional participation certificates. Interest is included in net interest income. Securities Certain debt securities that management has the positive intent and ability to hold to maturity are classified as “held to maturity” and recorded at amortized cost. Securities not classified as held to maturity or trading, including equity securities with readily determinable fair values, are classified as “available for sale” and recorded at fair value, with unrealized gains and losses excluded from earnings and reported in other comprehensive income. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. For debt securities with fair value below amortized cost when the Company does not intend to sell a debt security, and it is more likely than not the Company will not have to sell the security before recovery of its cost basis, it recognizes the credit component of an other‑than‑temporary impairment of a debt security in earnings and the remaining portion in other comprehensive income. For held‑to‑maturity debt securities, the amount of other‑than‑temporary impairment recorded in other comprehensive income for the noncredit portion of a previous other‑than‑temporary impairment is amortized prospectively over the remaining life of the security on the basis of the timing of future estimated cash flows of the security. Loans Held for Sale under Mortgage Banking Activities The Company uses participation agreements to fund mortgage loans held for sale from closing or purchase until sale to an investor. Under a participation agreement the Company elects to purchase a participation interest of up to 100% in individual loans. The Company shares proportionately in the interest income and the credit risk until the loan is sold to an investor. The Company holds the collateral until it is sent under a bailee arrangement to the investor. Typical investors are large financial institutions or government agencies. These loans are carried at the lower of cost or fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance and included in noninterest income. Other mortgage loans originated and intended for sale in the secondary market, for which the fair value option has been elected, are carried at fair value at each balance sheet date. The Company believes that the fair value is the best indicator of the resolution of these loans. The difference between the cost and fair value was not material at December 31, 2018. For all loans held for sale, interest earned from the time of funding to the time of sale is accrued and recognized as interest income. Gains and losses on loan sales are recorded in noninterest income, and generally direct loan origination costs and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan. The gain on sale of loans in the income statement may include placement and origination fees, capitalized mortgage servicing rights, trading gains and losses and other related income . Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balances adjusted for unearned income, charge‑offs, the allowance for loan losses, any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. For loans amortized at cost, interest income is accrued based on the unpaid principal balance. The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the credit is well‑secured and in process of collection. Past‑due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. For loans that are placed on nonaccrual or that are charged off, all accrued interest is reversed against interest income. The interest on these loans is applied to the principal balance until the loan can be returned to an accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. For all loan portfolio segments, the Company promptly charges off loans, or portions thereof, when available information confirms that specific loans are uncollectable based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower’s ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge‑off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral. When cash payments are received on impaired loans in each loan class, the Company records the payment as interest income unless collection of the remaining recorded principal amount is doubtful, at which time payments are used to reduce the principal balance of the loan. Troubled debt restructured loans recognize interest income on an accrual basis at the renegotiated rate if the loan is in compliance with the modified terms. The Company uses warehouse loans or credit to fund mortgage loans held for sale from closing until sale to an investor. Under a warehousing arrangement the Company funds a mortgage loan as secured financing. The warehousing arrangement is secured by the underlying mortgages and a combination of deposits, personal guarantees and advance rates. The Company holds the collateral until it is sent under a bailee arrangement instructing the investor to send proceeds to the Company. Typical investors are large financial institutions or government agencies. Interest earned from the time of funding to the time of sale is recognized as interest income as accrued. Fees earned agreements are recognized when collected as noninterest income. Allowance for Loan Losses The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non‑classified loans and is based on historical charge‑off experience and expected loss given default derived from the Company’s internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data. A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case‑by‑case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan‑by‑loan basis for commercial and construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price or the fair value of the collateral if the loan is collateral dependent. For impaired loans where the Company utilizes discounted cash flows to determine the level of impairment, the Company includes the entire change in the present value of cash flows as bad debt expense. Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, the Company does not separately identify individual consumer and residential loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower. In the course of working with borrowers, the Company may choose to restructure the contractual terms of certain loans. In restructuring the loan, the Company attempts to work out an alternative payment schedule with the borrower in order to optimize collectability of the loan. A troubled debt restructuring (TDR) occurs when, for economic or legal reasons related to a borrower’s financial difficulties, the Company grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with its current financial status, and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms, or a combination of the two. Nonaccrual loans, including TDRs that have not met the six-month minimum performance criterion, are reported as nonperforming loans. For all loan classes, it is the Company’s policy to have any restructured loans which are on nonaccrual status prior to being restructured remain on nonaccrual status until six months of satisfactory borrower performance, at which time management would consider its return to accrual status. A loan is generally classified as nonaccrual when the Company believes that receipt of principal and interest is questionable under the terms of the loan agreement. Most generally, this is at 90 or more days past due. With regard to determination of the amount of the allowance for credit losses, restructured loans are considered to be impaired. As a result, the determination of the amount of impaired loans for each portfolio segment within troubled debt restructurings is the same as detailed previously above. Premises and Equipment Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight‑line method over the estimated useful lives of the assets. The estimated useful lives for premises and equipment are as follows: Buildings 10 to 40 years Leasehold improvements 5 to 39 years Furniture, fixtures and equipment 3 to 10 years Vehicles 5 years Expenditures for property and equipment and for renewals or betterments that extend the originally estimated economic life of the assets are capitalized. Expenditures for maintenance and repairs are charged to expense. When an asset is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any gain or loss is included in the results of operations. Federal Home Loan Bank Stock Federal Home Loan Bank (FHLB) stock is a required investment for institutions that are members of a FHLB. The required investment in the common stock is based on a predetermined formula, carried at cost and evaluated for impairment. Other Real Estate Owned Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from other real estate. Mortgage Servicing Rights Mortgage servicing assets are recognized separately when rights are acquired through purchase or through sale of financial assets. Under the servicing assets and liabilities accounting guidance (ASC 860‑50), servicing rights resulting from the sale or securitization of loans originated by the Company are initially measured at fair value at the date of transfer. The Company has elected to initially and subsequently measure the mortgage servicing rights for mortgage loans using the fair value method. Under the fair value method, the servicing rights are carried in the balance sheet at fair value and the changes in fair value are reported in earnings in the period in which the changes occur. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model is from an independent third party and it incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds, prepayment penalties, and default rates and losses. These variables change from quarter to quarter as market conditions and projected interest rates change, and may have an adverse impact on the value of the mortgage‑servicing right and may result in a reduction to noninterest income. Servicing fee income is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. The change in the fair value of the mortgage‑servicing rights is netted against loan servicing fee income. Goodwill and Intangible Assets Goodwill is tested annually for impairment or more frequently if impairment indicators are present. If the implied fair value of goodwill is lower than its carrying amount, a goodwill impairment is indicated and goodwill is written down to its implied fair value. Subsequent increases in goodwill value are not recognized in the financial statements. Intangible assets, which include licenses and trade names, are amortized over a period ranging from 84 to 120 months using a straight line method of amortization. Also included are core deposit intangibles that are amortized over a 10 year period using the accelerated sum of the years digits method of amortization. On a periodic basis, the Company evaluates events and circumstances that may indicate a change in the recoverability of the carrying value. Investment in Qualified Affordable Housing Limited Partnerships The Company has elected to account for its investment in affordable housing tax credit limited partnerships using the proportional amortization method described in FASB ASU 2014‑01, “Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Qualified Affordable Housing Projects (A Consensus of the FASB Emerging Issues Task Force).” Under the proportional amortization method, an investor amortizes the initial cost of the investment to income tax expense in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense. The investment in the limited partnerships is included in other assets in the consolidated balance sheets. Income Taxes The Company accounts for income taxes in accordance with income tax accounting guidance (ASC 740, Income Taxes ). The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Company determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. Uncertain tax positions are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more‑likely‑than‑not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more‑likely‑than‑not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. With a few exceptions, the Company is no longer subject to U.S. federal, state and local or non‑U.S. income tax examinations by tax authorities for years before 2015. The Company recognizes interest and penalties, if any, on income taxes as a component of income tax expense. The Company files consolidated income tax returns with its subsidiaries. Earnings Per Share Basic earnings per share is the Company’s net income available to common shareholders, which represents net income less dividends paid or payable to preferred stock shareholders, if any, divided by the weighted‑average number of common shares outstanding during each period. Diluted earnings per share is calculated in the same manner as basic earnings per share, but also reflects the issuance of additional common shares that would have been diluted if such shares had been outstanding, as well as any adjustment to income that would result from the assumed issuance. Share‑based Compensation Plan The Company has a restricted stock plan that provides for annual awards of shares to certain members of senior management based upon the Company’s performance and attainment of certain performance goals established by the Board of Directors. Share awards are valued at the estimated fair value on the date of the award and generally vest over three years. Compensation expense for the awards is recognized in the consolidated financial statements ratably over the vesting period. Comprehensive Income Comprehensive income consists of net income and other comprehensive income (loss), net of applicable income taxes. Other comprehensive income (loss) and accumulated other comprehensive income consist entirely of unrealized appreciation (depreciation) on available‑for‑sale investment securities. Reclassifications Certain reclassifications have been made to the 2017 and 2016 financial statements to conform to the financial statement presentation as of and for the year ended December 31, 2018. These reclassifications had no effect on net income.

Restriction on Cash and Due Fro

Restriction on Cash and Due From Banks	12 Months Ended
	Dec. 31, 2018
Restriction on Cash and Due From Banks
Restriction on Cash and Due From Banks	Note 2: Restriction on Cash and Due From Banks The Company is required to maintain reserve funds in cash and/or on deposit with the Federal Reserve Bank. The reserve required at December 31, 2018 and 2017 was $114.2 million and $104.2 million, respectively.

Securities

Securities	12 Months Ended
	Dec. 31, 2018
Securities
Securities	Note 3: Securities Trading Securities Securities that are held principally for resale in the near term are recorded as trading securities at fair value. Trading securities include FHA and conventional Fannie Mae and Freddie Mac participation certificates. The unrealized gains included in earnings for trading securities totaled $870,000 and $643,000 at December 31, 2018 and 2017, respectively. Securities Available-For-Sale The amortized cost and approximate fair values, together with gross unrealized gains and losses, of securities are as follows: December 31, 2018 Gross Gross Approximate Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Available-for-sale securities: Treasury notes $ 11,928 $ 26 $ 13 $ 11,941 Federal agencies 237,894 8 972 236,930 Municipals 21,014 336 18 21,332 Mortgage-backed - Government-sponsored entity (GSE) - residential 60,693 254 79 60,868 Total available-for-sale securities $ 331,529 $ 624 $ 1,082 $ 331,071 December 31, 2017 Gross Gross Approximate Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Available-for-sale securities: Treasury notes $ 1,000 $ — $ 8 $ 992 Federal agencies 376,414 — 1,683 374,731 Municipals 6,688 — — 6,688 Mortgage-backed - Government-sponsored entity (GSE) - residential 25,960 — — 25,960 Total available-for-sale securities $ 410,062 $ — $ 1,691 $ 408,371 The amortized cost and fair value of available‑for‑sale securities at December 31, 2018 by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. December 31, 2018 Amortized Fair Cost Value Contractual Maturity (In thousands) Within one year $ 179,323 $ 178,581 After one through five years 72,470 72,282 After five through ten years 7,087 7,203 After ten years 11,956 12,137 270,836 270,203 Mortgage-backed - Government-sponsored entity (GSE) - residential 60,693 60,868 $ 331,529 $ 331,071 Certain investments in debt securities are reported in the consolidated financial statements at an amount less than their historical cost. Total fair value of these investments at December 31, 2018 and 2017 was $240.2 million and $375.7 million, respectively, which is approximately 73%, and 92%, respectively, of the Company’s available‑for‑sale investment portfolio. The following tables show the Company’s gross unrealized losses and fair value of the Company’s investments with unrealized losses that are not deemed to be other‑than‑temporarily impaired, aggregated by investment class and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2018, and 2017: December 31, 2018 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Available-for-sale securities: Treasury notes $ 1,990 $ 8 $ 995 $ 5 $ 2,985 $ 13 Federal agencies 28,296 97 191,280 875 219,576 972 Municipals 2,051 18 — — 2,051 18 Mortgage-backed - Government-sponsored entity (GSE) - residential 15,543 79 — — 15,543 79 $ 47,880 $ 202 $ 192,275 $ 880 $ 240,155 $ 1,082 December 31, 2017 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Available-for-sale securities: Treasury notes $ 992 $ 8 $ — $ — $ 992 $ 8 Federal agencies 191,064 903 183,667 780 374,731 1,683 $ 192,056 $ 911 $ 183,667 $ 780 $ 375,723 $ 1,691 Unrealized losses on securities have not been recognized to income because the Company has the intent and ability to hold the securities for the foreseeable future, and the decline in fair value is primarily due to increased market interest rates. The fair value is expected to recover as the bonds approach the maturity date. Proceeds from the sale of securities available for sale during the years ended December 31, 2018, 2017 and 2016 were $6.4 million, $0, and $7.4 million, respectively. Gross gains of $0, $0, and $24,000 were realized on 2018, 2017, and 2016 sales, respectively. The carrying value of securities pledged as collateral, to secure borrowings, pubic deposits and for other purposes, was $281.2 million, and $401.7 million at December 31, 2018 and 2017, respectively.

Loans and Allowance for Loan Lo

Loans and Allowance for Loan Losses	12 Months Ended
	Dec. 31, 2018
Loans and Allowance for Loan Losses
Loans and Allowance for Loan Losses	Note 4: Loans and Allowance for Loan Losses Classes of loans at December 31, 2018 and 2017, include: December 31, December 31, 2018 2017 (In thousands) Mortgage warehouse lines of credit $ 337,332 $ 224,937 Residential real estate 410,871 330,410 Multi-family and healthcare financing 914,393 529,259 Commercial and commercial real estate 299,194 228,668 Agricultural production and real estate 79,255 51,966 Consumer and margin loans 17,082 9,420 2,058,127 1,374,660 Less Allowance for loan losses 12,704 8,311 Loans Receivable $ 2,045,423 $ 1,366,349 Risk characteristics applicable to each segment of the loan portfolio are described as follows. Mortgage Warehouse Lines of Credit (MTG WHLOC): Under its warehouse program, the Company provides warehouse financing arrangements to approved mortgage companies for the origination and sale of residential mortgage loans and to a lesser extent multi‑family loans. Agency eligible, governmental and jumbo residential mortgage loans that are secured by mortgages placed on existing one to four family dwellings may be originated or purchased and placed on each mortgage warehouse line. As a secured line of credit, collateral pledged to the Company secures each individual mortgage until the lender sells the loan in the secondary market. A traditional secured warehouse line of credit typically carries a base interest rate of 30‑day LIBOR, or the Wall Street Journal Prime Rate, plus a margin. Risk is evident if there is a change in the fair value of mortgage loans originated by mortgage bankers during the time in warehouse, which is typically less than 30 days. The sale is the expected source of repayment of the borrowings under a warehouse line of credit. Residential Real Estate Loans (RES RE): The real estate loans are secured by owner‑occupied 1‑4 family residences. Repayment of residential real estate loans is primarily dependent on the personal income and credit rating of the borrowers. Multi‑Family and Healthcare Financing (MF RE): The Company engages in multi‑family and healthcare financing, including construction loans, specializing in originating and servicing loans for multi‑family rental and healthcare properties. In addition, the Company originates loans secured by an assignment of federal income tax credits by partnerships invested in multi‑family real estate projects. Construction and land loans are generally based upon estimates of costs and estimated value of the completed project and include independent appraisal reviews and a financial analysis of the developers and property owners. Sources of repayment of these loans may include permanent loans, sales of developed property or an interim loan commitment from Merchants Bank until permanent financing is obtained. These loans are considered to be higher risk than other real estate loans due to their ultimate repayment being sensitive to interest rate changes, general economic conditions and the availability of long‑term financing. Credit risk in these loans may be impacted by the creditworthiness of a borrower, property values and the local economy in the Company and project market area. Repayment of these loans depends on the successful operation of a business or property and the borrower’s cash flows. Commercial Lending and Commercial Real Estate Loans (CML & CRE): The commercial lending and commercial real estate portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions, as well as loans to commercial customers to finance land and improvements. The loans in this category are repaid primarily from the cash flow of a borrower’s principal business operation. Credit risk in these loans is driven by creditworthiness of a borrower and the economic conditions that impact the cash flow stability from business operations. Agricultural Production and Real Estate Loans (AG & AGRE): Agricultural production loans are generally comprised of seasonal operating lines of credit to grain farmers to plant and harvest corn and soybeans and term loans to fund the purchase of equipment. The Company also offers long‑term financing to purchase agricultural real estate. Specific underwriting standards have been established for agricultural‑related loans including the establishment of projections for each operating year based on industry‑developed estimates of farm input costs and expected commodity yields and prices. Operating lines are typically written for one year and secured by the crop and other farm assets as considered necessary. The Company is approved to sell agricultural loans in the secondary market through the Federal Agricultural Mortgage Corporation and uses this relationship to manage interest rate risk within the portfolio. Consumer and Margin Loans (CON & MAR): Consumer loans are those loans secured by household goods. Margin loans are those loans secured by marketable securities. The term and maximum amount for these loans are determined by considering the purpose of the loan, the margin (advance percentage against value) in all collateral, the primary source of repayment, and the borrower’s other related cash flow. The following tables present by loan portfolio segment, the activity in the allowance for loan losses for the years ended December 31, 2018, 2017 and 2016 and the recorded investment in loans and impairment method as of December 31, 2018, 2017 and 2016: At or For the Year Ended December 31, 2018 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Allowance for loan losses Balance, beginning of period $ 283 $ 1,587 $ 3,502 $ 2,362 $ 320 $ 257 $ 8,311 Provision for loan losses 785 399 2,528 779 109 29 4,629 Loans charged to the allowance — — — (90) — (146) (236) Recoveries of loans previously charged off — — — — — — — Balance, end of period $ 1,068 $ 1,986 $ 6,030 $ 3,051 $ 429 $ 140 $ 12,704 Ending balance: individually evaluated for impairment $ 225 $ — $ — $ 400 $ 20 $ — $ 645 Ending balance: collectively evaluated for impairment $ 843 $ 1,986 $ 6,030 $ 2,651 $ 409 $ 140 $ 12,059 Loans Ending balance $ 337,332 $ 410,871 $ 914,393 $ 299,194 $ 79,255 $ 17,082 $ 2,058,127 Ending balance individually evaluated for impairment $ 575 $ 1,606 $ — $ 8,576 $ 370 $ 58 $ 11,185 Ending balance collectively evaluated for impairment $ 336,757 $ 409,265 $ 914,393 $ 290,618 $ 78,885 $ 17,024 $ 2,046,942 At or For the Year Ended December 31, 2017 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Allowance for loan losses Balance, beginning of period $ 373 $ 2,170 $ 1,962 $ 1,374 $ 269 $ 102 $ 6,250 Provision (credit) for loan losses (90) (583) 1,540 1,399 51 155 2,472 Loans charged to the allowance — — — (546) — — (546) Recoveries of loans previously charged off — — — 135 — — 135 Balance, end of period $ 283 $ 1,587 $ 3,502 $ 2,362 $ 320 $ 257 $ 8,311 Ending balance: individually evaluated for impairment $ — $ — $ — $ 200 $ 16 $ 146 $ 362 Ending balance: collectively evaluated for impairment $ 283 $ 1,587 $ 3,502 $ 2,162 $ 304 $ 111 $ 7,949 Loans Ending balance $ 224,937 $ 330,410 $ 529,259 $ 228,668 $ 51,966 $ 9,420 $ 1,374,660 Ending balance individually evaluated for impairment $ — $ 729 $ — $ 6,179 $ 282 $ 146 $ 7,336 Ending balance collectively evaluated for impairment $ 224,937 $ 329,681 $ 529,259 222,489 $ 51,684 $ 9,274 $ 1,367,324 For the Year Ended December 31, 2016 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Allowance for loan losses Balance, beginning of year $ 704 $ 2,212 $ 1,308 $ 908 $ 222 $ 68 $ 5,422 Provision for loan losses (331) 90 654 466 47 34 960 Transfer out — (132) — — — — (132) Loans charged to the allowance — — — — — — — Recoveries of loans previously charged off — — — — — — — Balance, end of year $ 373 $ 2,170 1,962 $ 1,374 $ 269 $ 102 $ 6,250 Internal Risk Categories In adherence with policy, the Company uses the following internal risk grading categories and definitions for loans: Average or above —Loans to borrowers of satisfactory financial strength or better. Earnings performance is consistent with primary and secondary sources of repayment that are well defined and adequate to retire the debt in a timely and orderly fashion. These businesses would generally exhibit satisfactory asset quality and liquidity with moderate leverage, average performance to their peer group and experienced management in key positions. These loans are disclosed as “Acceptable and Above” in the following table. Acceptable —Loans to borrowers involving more than average risk and which contain certain characteristics that require some supervision and attention by the lender. Asset quality is acceptable, but debt capacity is modest and little excess liquidity is available. The borrower may be fully leveraged and unable to sustain major setbacks. Covenants are structured to ensure adequate protection. Borrower’s management may have limited experience and depth. This category includes loans which are highly leveraged due to regulatory constraints, as well as loans involving reasonable exceptions to policy. These loans are disclosed as “Acceptable and Above” in the following table. Special Mention (Watch) —This is a loan that is sound and collectable but contains considerable risk. Loans classified as special mention have a potential weakness that deserves management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution’s credit position at some future date. Substandard —Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well‑defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful —Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. The following tables present the credit risk profile of the Company’s loan portfolio based on internal rating category and payment activity as of December 31, 2018 and 2017: December 31, 2018 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Special Mention (Watch) $ — $ 443 $ 71,734 $ 14,650 $ 3,096 $ 681 $ 90,604 Substandard 575 1,606 — 8,576 370 58 11,185 Doubtful — — — — — — — Acceptable and Above 336,757 408,822 842,659 275,968 75,789 16,343 1,956,338 Total $ 337,332 $ 410,871 $ 914,393 $ 299,194 $ 79,255 $ 17,082 $ 2,058,127 December 31, 2017 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Special Mention (Watch) $ — $ — $ 1,800 $ 12,608 $ 323 $ 1,563 $ 16,294 Substandard — 729 — 6,179 282 146 7,336 Doubtful — — — — — — — Acceptable and Above 224,937 329,681 527,459 209,881 51,361 7,711 1,351,030 Total $ 224,937 $ 330,410 $ 529,259 $ 228,668 $ 51,966 $ 9,420 $ 1,374,660 The Company evaluates the loan risk grading system definitions and allowance for loan loss methodology on an ongoing basis. No significant changes were made to either during the past year. The following tables present the Company’s loan portfolio aging analysis of the recorded investment in loans as of December 31, 2018 and 2017: December 31, 2018 30-59 Days 60-89 Days Greater Than Total Total Past Due Past Due 90 Days Past Due Current Loans (In thousands) MTG WHLOC $ — $ — $ 324 $ 324 $ 337,008 $ 337,332 RES RE 579 178 825 1,582 409,289 410,871 MF RE — — — — 914,393 914,393 CML & CRE 245 52 253 550 298,644 299,194 AG & AGRE 91 — 588 679 78,576 79,255 CON & MAR 2 52 28 82 17,000 17,082 $ 917 $ 282 $ 2,018 $ 3,217 $ 2,054,910 $ 2,058,127 December 31, 2017 30-59 Days 60-89 Days Greater Than Total Total Past Due Past Due 90 Days Past Due Current Loans (In thousands) MTG WHLOC $ — $ — $ — $ — $ 224,937 $ 224,937 RES RE — 194 534 728 329,682 330,410 MF RE — — — — 529,259 529,259 CML & CRE — 860 2,061 2,921 225,747 228,668 AG & AGRE 59 — 399 458 51,508 51,966 CON & MAR — — 146 146 9,274 9,420 $ 59 $ 1,054 $ 3,140 $ 4,253 $ 1,370,407 $ 1,374,660 A loan is considered impaired, in accordance with the impairment accounting guidance (ASC 310‑10‑35‑16), when based on current information and events, it is probable the Company will be unable to collect all amounts due from the borrower in accordance with the contractual terms of the loan. Impaired loans include nonperforming commercial loans but also include loans modified in troubled debt restructurings. The following tables present impaired loans and specific valuation allowance information based on class level as of December 31, 2018 and 2017: December 31, 2018 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Impaired loans without a specific allowance: Recorded investment $ 251 $ 1,606 $ — $ 5,636 $ 88 $ 58 $ 7,639 Unpaid principal balance 251 1,606 — 5,636 88 58 7,639 Impaired loans with a specific allowance: Recorded investment 324 — — 2,940 282 — 3,546 Unpaid principal balance 324 — — 2,940 282 — 3,546 Specific allowance 225 — — 400 20 — 645 Total impaired loans: Recorded investment 575 1,606 — 8,576 370 58 11,185 Unpaid principal balance 575 1,606 — 8,576 370 58 11,185 Specific allowance 225 — — 400 20 — 645 December 31, 2017 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Impaired loans without a specific allowance: Recorded investment $ — $ 729 $ — $ 4,119 $ — $ — $ 4,848 Unpaid principal balance — 729 — 4,119 — — 4,848 Impaired loans with a specific allowance: Recorded investment — — — 2,060 282 146 2,488 Unpaid principal balance — — — 2,060 282 146 2,488 Specific allowance — — — 200 16 146 362 Total impaired loans: Recorded investment — 729 — 6,179 282 146 7,336 Unpaid principal balance — 729 — 6,179 282 146 7,336 Specific allowance — — — 200 16 146 362 The following tables present by portfolio class, information related to the average recorded investment and interest income recognized on impaired loans for the years ended December 31, 2018, 2017and 2016: December 31, 2018 MTG CML & AG & CON & WHLOC RES RE MF RE CRE AGRE MAR TOTAL (In thousands) Average recorded investment in impaired loans $ 932 $ 1,485 $ — $ 8,872 $ 489 $ 52 $ 11,830 Interest income recognized 59 50 — 375 43 1 528 December 31, 2017 MTG WHLOC RES RE MF CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Average recorded investment in impaired loans $ — $ 156 $ — $ 3,703 $ 282 $ 197 $ 4,338 Interest income recognized — 1 — 182 — — 183 December 31, 2016 MTG CML & AG & CON & WHLOC RES RE MF RE CRE AGRE MAR TOTAL (In thousands) Average recorded investment in impaired loans $ — $ 155 $ — $ 2,222 $ 17 $ — $ 2,394 Interest income recognized — — — 39 — — 39 The following table presents the Company’s nonaccrual loans and loans past due 90 days or more and still accruing at December 31, 2018 and 2017. December 31, December 31, 2018 2017 Total Loans > Total Loans > 90 Days & 90 Days & Nonaccrual Accruing Nonaccrual Accruing (In thousands) MTG WHLOC $ 575 $ — $ — $ — RES RE 893 74 60 475 MF RE — — — — CML & CRE 136 117 2,060 — AG & AGRE 282 307 282 117 CON & MAR 18 9 146 — $ 1,904 $ 507 $ 2,548 $ 592 During 2018, the Company had one newly classified troubled debt restructuring in the CML & CRE loan class. The loan had a pre and post modification balance of $2.0 million. During 2017, the Company had one newly classified troubled debt restructuring to the same borrower in the CML & CRE loan class. This loan also had a pre and post modification balance of $2.0 million. The modifications on both loans included a combination of term and rate concessions which reflect the unlikeliness of the borrower being able to obtain similar financing from another financial institution. There were no new troubled debt restructurings during 2016. For 2018, 2017 and 2016, no troubled debt restructurings modified in the past 12 months subsequently defaulted. There were no residential loans in the process of foreclosure at December 31, 2018 or December 31, 2017.

Derivative Financial Instrument

Derivative Financial Instruments	12 Months Ended
	Dec. 31, 2018
Derivative Financial Instruments
Derivative Financial Instruments	Note 5: Derivative Financial Instruments The Company uses derivative financial instruments to help manage exposure to interest rate risk and the effects that changes in interest rates may have on net income and the fair value of assets and liabilities. The Company enters into forward contracts for the future delivery of mortgage loans to third party investors and enters into interest rate lock commitments with potential borrowers to fund specific mortgage loans that will be sold into the secondary market. The forward contracts are entered into in order to economically hedge the effect of changes in interest rates resulting from the Company’s commitment to fund the loans. Each of these items are considered derivatives, but are not designated as accounting hedges, and are recorded at fair value with changes in fair value reflected in noninterest income on the consolidated statements of income. The fair value of derivative instruments with a positive fair value are reported in other assets in the consolidated balance sheets while derivative instruments with a negative fair value are reported in other liabilities in the consolidated balance sheets. The following table presents the notional amount and fair value of interest rate locks and forward contracts utilized by the Company at December 31, 2018. There were no material derivatives recorded at December 31, 2017. Notional Fair Value Amount Balance Sheet Location Asset (Liability) December 31, 2018 (In thousands) (In thousands) Interest rate lock commitments $ 8,812 Derivative assets/liabilities $ 70 $ — Forward contracts 19,640 Derivative assets/liabilities — 9 $ 70 $ 9 Fair values of derivative financial instruments were estimated using changes in mortgage interest rates from the date the Company entered into the interest rate lock commitment and the balance sheet date. The following table summarizes the periodic changes in the fair value of the derivative financial instruments on the consolidated statements of income for the years ended December 31, 2018 and 2017. Year Ended December 31, 2018 2017 (In thousands) Interest rate lock commitments $ 70 $ — Forward contracts (1) (64) — Net derivative gains (losses) 6 $ — _________________________________ (1) Amount includes pair-off settlements.

Loan Servicing

Loan Servicing	12 Months Ended
	Dec. 31, 2018
Loan Servicing
Loan Servicing	Note 6: Loan Servicing Mortgage loans serviced for others are not included in the accompanying consolidated balance sheets and represent agency eligible multi‑family loans. The risks inherent in mortgage servicing assets relate primarily to changes in prepayments that result from shifts in mortgage interest rates. Call protection is in place to deter from prepayments on a 10‑year sliding scale. The unpaid principal balances of mortgage and other loans serviced for others were $5.8 billion and $5.0 billion at December 31, 2018 and 2017, respectively. Mortgage loans sub‑serviced for others are not included in the accompanying balance sheets. The unpaid principal balances of loans sub‑serviced for others were $3.1 billion and $2.0 billion at December 31, 2018 and 2017, respectively. The following summarizes the activity in mortgage servicing rights measured using the fair value method for the years ended December 31, 2018, 2017, and 2016: For the Year Ended December 31, 2018 2017 2016 (In thousands) Balance, beginning of period $ 66,079 $ 53,670 $ 55,553 Additions Originated and purchased servicing 14,113 10,993 5,745 Acquisition of MCS — 3,970 — Subtractions Paydowns (4,196) (5,504) (4,230) Changes in fair value due to changes in valuation inputs or assumptions used in the valuation model 1,848 2,950 (3,398) Balance, end of period $ 77,844 $ 66,079 $ 53,670 Contractually specified servicing fees for retained, purchased and sub‑serviced loans were $8.7 million, $8.8 million, and $7.5 million for the years ended December 31, 2018, 2017 and 2016, respectively. In connection with certain loan servicing and sub‑servicing agreements, the Company is to reconcile the payments received monthly on these loans, for principal and interest, taxes, insurance, and reserves for replacements. The funds are required to be maintained in separate trust accounts and not commingled with the Company’s general operating funds. At December 31, 2018 and 2017, MCC held restricted escrow funds for these loans, amounting to $412.4 million and $502.7 million, respectively.

Goodwill and Intangibles

Goodwill and Intangibles	12 Months Ended
	Dec. 31, 2018
Goodwill and Intangibles
Goodwill and Intangibles	Note 7: Goodwill and Intangibles Goodwill at December 31, 2018 increased by approximately $13.6 million, compared with December 31, 2017, primarily as a result of the FMBI, FMNBP, and NattyMac, LLC acquisitions on January 2, 2018, October 1, 2018, and December 31,2018, respectively. Goodwill represents the amount by which the cost of an acquisition exceeded the fair value of net assets acquired. Goodwill is tested for impairment as of year‑end, or more frequently if events and circumstances exist that indicate a goodwill impairment test should be performed. Based upon management’s assessment and evaluation of goodwill at year‑end, the likelihood that an impairment of the current carrying amount of goodwill has occurred is considered remote. 2018 2017 2016 Multifamily Banking Warehouse Total Multifamily Banking Warehouse Total Multifamily Banking Warehouse Total (In thousands) (In thousands) (In thousands) Balance, beginning of period $ 3,379 $ 523 $ — $ 3,902 $ — $ 523 $ — $ 523 $ — $ 523 $ — $ 523 Goodwill acquired during the period — 8,163 5,000 13,163 3,379 — — 3,379 — — — — Post-acquisition adjustment 412 — — 412 — — — — — — — — Impairment losses — — — — — — — — — — — — Balance, end of period $ 3,791 $ 8,686 $ 5,000 $ 17,477 $ 3,379 $ 523 $ — $ 3,902 $ — $ 523 $ — $ 523 In conjunction with the acquisition of the assets of NattyMac, LLC on December 31, 2018, the Company recorded goodwill of $5.0 million in the Warehouse segment. No intangible assets were recorded, but further evaluation may result in changes to this assumption. In conjunction with the acquisition of FMNBP on October 1, 2018, the Company recorded goodwill of $7.2 million in the Banking segment as of December 31, 2018. The Company also recorded intangible assets for core deposits, as summarized below. The core deposit intangibles are being amortized over 10 years using the accelerated sum of the years digits method. Amortization for these intangible assets was $85,000 for the year ended December 31, 2018. In conjunction with the acquisition of FMBI on January 2, 2018, the Company recorded goodwill of $988,000 in the Banking segment as of December 31, 2018. The Company also recorded intangible assets for core deposits, as summarized below. The core deposit intangibles are being amortized over 10 years using the accelerated sum of the years digits method. Amortization for these intangible assets was $84,000 for the year ended December 31, 2018. In conjunction with the acquisition of MCS on August 15, 2017, the Company recorded goodwill of $3.4 million in the Multi-family segment. An adjustment of $412,000 was added to goodwill during the year ended December 31, 2018 related to contingent consideration for loans closed after the acquisition date. The Company also recorded intangible assets for licenses and trade names as summarized below. The licenses are being amortized over 84 months and trade names are being amortized over 120 months. Amortization of these intangible assets was $218,000 for the year ended December 31, 2018, $82,000 for the year ended December 31, 2017. 2018 2017 2016 Gross Gross Gross Carrying Accumulated Carrying Accumulated Carrying Accumulated Amount Amortization Total Amount Amortization Total Amount Amortization Total (In thousands) (In thousands) (In thousands) Licenses $ 1,370 $ (269) $ 1,101 $ 1,370 $ (74) $ 1,296 $ — $ — $ — Trade names 224 (31) 193 224 (8) 216 — — — Core deposit intangible 2,417 (169) 2,248 — — — — — — Total intangible Assets $ 4,011 $ (469) $ 3,542 $ 1,594 $ (82) $ 1,512 $ — $ — $ — Estimated amortization expense for future years is as follows (in thousands): Year ending December 31, 2019 $ 639 2020 619 2021 577 2022 521 2023 462 Thereafter 724 Total $ 3,542

Premises and Equipment

Premises and Equipment	12 Months Ended
	Dec. 31, 2018
Premises and Equipment
Premises and Equipment	Note 8: Premises and Equipment Major classifications of premises and equipment, stated at cost, are as follows: December 31, 2018 2017 (In thousands) Land $ 3,072 $ 2,260 Buildings 4,095 3,140 Building in progress 8,272 407 Leasehold improvements 83 71 Furniture, fixtures and equipment 2,427 2,131 Total cost 17,949 8,009 Accumulated depreciation (2,813) (2,655) Net premises and equipment $ 15,136 $ 5,354 The Company entered into a contract on December 29, 2017 for the construction of a new office building, which is expected to cost approximately $17.9 million and be completed by the summer of 2019.

Other Assets and Receivables

Other Assets and Receivables	12 Months Ended
	Dec. 31, 2018
Other Assets and Receivables.
Other Assets and Receivables	Note 9: Other Assets and Receivables The following items are included in other assets and receivables in the consolidated balance sheets. Investment in Qualified Affordable Housing Limited Partnerships The Company invests in qualified affordable housing limited partnerships. At December 31, 2018 and 2017, the balance of the investments for qualified affordable housing limited partnerships was $17.2 million and $15.6. million, respectively. The Company expects to contribute an additional $1.1 million related to the partnerships outstanding at December 31, 2018; however, the Company is not obligated to contribute additional capital, as such payments are based on certain development, operational and/or tax credit benchmarks. During the years ended December 31, 2018 and 2017, the Company recorded amortization expense of $1.2 million and $0, respectively. Tax credits related to these investments were $1.5 million for the 2018 tax year and was $0 for the 2017 tax year. The Company expects to receive additional tax credits and other benefits in 2019 and will continue to amortize this investment based on the proportional amortization method. Other items included in other assets and receivables on the balance sheet are not individually significant.

Deposits

Deposits	12 Months Ended
	Dec. 31, 2018
Deposits
Deposits	Note 10: Deposits Deposits were comprised of the following at and December 31, 2018 and 2017: December 31, 2018 2017 (In thousands) Demand deposits $ 1,548,969 $ 1,279,145 Savings deposits 1,001,663 1,255,460 Certificates of deposit 680,454 408,956 Total deposits $ 3,231,086 $ 2,943,561 At December 31, 2018, the scheduled maturities of time deposits are as follows: December 31, 2018 (In thousands) Due within one year $ 648,173 Due in one year to two years 18,062 Due in two years to three years 9,727 Due in three years to four years 2,964 Due in four years to five years 1,528 $ 680,454 Certificates of deposit of $250,000 or more totaled $46.7 million at December 31, 2018 and $56.8 million at December 31, 2017. Brokered deposit amounts at December 31, 2018 and 2017, were as follows: December 31, 2018 2017 (In thousands) Brokered certificates of deposit $ 578,471 $ 347,000 Brokered savings deposits 109,607 389,475 Brokered deposit on demand accounts 300,134 205,039 $ 988,212 $ 941,514

Borrowings

Borrowings	12 Months Ended
	Dec. 31, 2018
Borrowings
Borrowings	Note 11: Borrowings Borrowings were comprised of the following at December 31, 2018 and 2017: December 31, 2018 2017 (In thousands) Lines of credit $ 33,150 $ 25,000 Short-term subordinated debt 10,582 30,000 FHLB advances 151,721 1,612 Total borrowings $ 195,453 $ 56,612 The Company has a revolving line of credit (“LOC”) with a bank for up to $25.0 million with an outstanding balance at both December 31, 2018 and 2017 of $25.0 million. The interest rate on the note is LIBOR Rate plus 1.85%, or 4.2%, at December 31, 2018 and 3.23% at December 31, 2017. The LOC is collateralized by a pledge and first lien security interest in and to all of the issued and outstanding common stock of Merchants Bank of Indiana, the 100% owned subsidiary of the Company. The agreement also requires Merchants Bank to maintain at all times a Tier 1 Leverage Ratio of not less than 8% and is tested on a quarterly basis. The LOC was amended effective June 1, 2018, which extended the maturity date to May 31, 2019. The Company also has a LOC with the Federal Home Loan Bank. This arrangement has a maximum borrowing limit of collateral pledged, with an outstanding balance at both December 31, 2018 and 2017 of $8.2 million and $0, respectively. The floating interest rate on the LOC is set daily at a fixed spread to the actual Federal Funds rate earned by the FHLB, or 2.61% at December 31, 2018. The LOC is automatically renewed daily, unless either party notifies the other of its desire not to continue the arrangement. FHLB advances and the line of credit are secured by mortgage loans totaling $88.1 million and $74.4 million at, December 31, 2018 and 2017, respectively. In addition, available for sale securities and securities purchased under agreements to resell with a carrying value of $269.3 million and $407.7 million were pledged as of December 31, 2018 and 2017, respectively. At December 31, 2018, the FHLB advances had interest rates ranging from 1.79% to 4.74%, and at December 31, 2017, the FHLB advances had interest rates ranging from 2.27% to 4.74%, and were subject to restrictions or penalties in the event of prepayment. The Company entered into an arrangement with Home Point Financial Corporation (a large customer of Merchants Bank) on April 15, 2014 and amended on September 25, 2014. Home Point agreed to invest up to $30.0 million in the Company’s subordinated debt. The Company, in turn, agreed to form and fund NMF, a wholly owned subsidiary of Merchants Bank, and Merchants Bank pledged 100% of the shares of NMF stock to Home Point in consideration for their investment in the Company’s subordinated debt, with the shares serving as the sole collateral for such debt. The subordinated debt balance as of both December 31, 2018 and December 31, 2017 was $0 and $30.0 million, respectively. Interest on the debt was paid quarterly at a rate equal to one‑month LIBOR, plus 350 basis points, plus additional interest equal to 49% of the earnings of NMF. The Company fully repaid the debt and terminated the agreement prior to purchasing the assets of NattyMac, LLC on December 31, 2018. The Company also entered into another warehouse financing arrangement with another customer in April 24, 2018, similar to the revolving arrangement with Home Point Financial described above, whereby the customer agreed to invest up to $30 million in the Company’s subordinated debt. The subordinated debt balance as of December 31, 2018 was $10.6 million. Interest on the debt is paid quarterly by the Company at a rate equal to one-month LIBOR, plus 350 basis points, plus additional interest equal to 50% of the earnings generated. The agreement is automatically renewed annually on April 24 th , unless either party notifies the other party at least 180 days prior to its renewable date, of its desire not to continue the relationship. Maturities of FHLB advances were as follows December 31, 2018: December 31, 2018 (In thousands) Due within one year $ 149,304 Due in one year to two years 590 Due in two years to three years 77 Due in three years to four years 59 Due in four years to five years 342 Thereafter 1,349 $ 151,721

Income Taxes

Income Taxes	12 Months Ended
	Dec. 31, 2018
Income Taxes
Income Taxes	Note 12: Income Taxes On December 22, 2017, the United States enacted the Tax Cuts and Jobs Act, which significantly changes the existing U.S. tax laws, including a reduction in the corporate tax rate from 35% to 21%. As a result of enactment of the legislation, the Company recorded in the fourth quarter of 2017, an additional one-time income tax benefit of $6.9 million, primarily related to the re-measurement of certain deferred tax assets and liabilities and included an expense of $243,000 related to the adjustment of the deferred tax asset for net unrealized losses on available for sale securities. The provision for income taxes includes these components for the years ended December 31, 2018, 2017 and 2016: Year Ended December 31, 2018 2017 2016 (In thousands) Income tax expense Current tax payable Federal $ 13,312 $ 21,413 $ 18,627 State 5,528 3,479 4,477 Deferred tax payable Federal 1,583 (2,627) (441) State 730 212 (995) Income tax expense $ 21,153 $ 22,477 $ 21,668 Effective tax rate 25.2 % 29.1 % 39.5 % A reconciliation of income tax expense at the statutory rate to the Company’s actual income tax expense for the years ended December 31, 2018, 2017 and 2016, is shown below: Year Ended December 31, 2018 2017 2016 (In thousands) Computed at the statutory rate (21% for 2018 and 35% for 2017 and 2016) $ 17,646 $ 27,006 $ 19,178 Increase resulting from State income taxes 4,944 2,399 2,264 Effect of Tax Cuts and Jobs Act — (6,928) — Low income housing tax credits (1,533) — — Other 96 — 226 Actual tax expense $ 21,153 $ 22,477 $ 21,668 The tax effects of temporary differences related to deferred taxes shown on the balance sheet were: December 31, 2018 2017 (In thousands) Deferred tax assets Allowance for loan losses $ 3,366 $ 2,216 Unrealized loss on available-for-sale securities 148 442 Other 854 1,548 Total assets 4,368 4,206 Deferred tax liabilities Depreciation (466) (147) Intangible assets (618) — Mortgage-servicing rights (17,477) (15,548) Limited partnership investments (2,212) (1,446) Fair value adjustments on acquisitions (3) — Total liabilities (20,776) (17,141) Net deferred tax liability $ (16,408) $ (12,935) As of December 31, 2018, the Company had approximately $800,000 of federal operating loss carryforwards available to offset future taxable income with no expiration date. The net operating losses were acquired from FMBI and FMNBP.

Regulatory Matters

Regulatory Matters	12 Months Ended
	Dec. 31, 2018
Regulatory Matters
Regulatory Matters	Note 13: Regulatory Matters The Company, Merchants Bank, and FMBI are subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory, and possibly additional discretionary, actions by federal and state banking regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company, Merchants Bank and FMBI must meet specific capital guidelines that involve quantitative measures of the Company’s, Merchants Bank’s, and FMBI’s assets, liabilities and certain off‑balance‑sheet items as calculated under regulatory accounting practices. The Company’s, Merchants Bank’s, and FMBI’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Furthermore, the Company’s, Merchants Bank’s, and FMBI’s regulators could require adjustments to regulatory capital not reflected in these financial statements. Quantitative measures established by regulation to ensure capital adequacy require the Company, Merchants Bank, and FMBI to maintain minimum amounts and ratios (set forth in the table below). Management believes, as of December 31, 2018 and 2017, that the Company, Merchants Bank, and FMBI met all capital adequacy requirements to which they were subject. As of December 31, 2018, the most recent notifications from the Federal Reserve Board, the FDIC, and IDFPR categorized the Company, Merchants Bank, and FMBI as well capitalized under the regulatory framework for prompt corrective action, respectively. To be categorized as well capitalized, the Company, Merchants Bank, and FMBI must maintain minimum total risk‑based, Tier I risk‑based and Tier I leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the Company’s, Merchants Bank’s or FMBI’s category. The Company’s, Merchants Bank’s, and FMBI’s actual capital amounts and ratios are also presented in the following tables. Minimum Amount Required for Minimum Amount Adequately To Be Well Actual Capitalized (1) Capitalized (1) Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) December 31, 2018 Total capital (1) (to risk-weighted assets) Company $ 393,654 12.3 % $ 255,884 8.0 % $ — N/A Merchants Bank 412,386 13.3 % 248,290 8.0 % 310,363 10.0 % FMBI 17,537 18.6 % 7,559 8.0 % 9,448 10.0 % Tier 1 capital (1) (to risk-weighted assets) Company 380,950 11.9 % 191,913 6.0 % — N/A Merchants Bank 399,815 12.9 % 186,218 6.0 % 248,290 8.0 % FMBI 17,404 18.4 % 5,669 6.0 % 7,559 8.0 % Common Equity Tier 1 capital (1) (to risk-weighted assets) Company 339,369 10.6 % 143,935 4.5 % — N/A Merchants Bank 399,815 12.9 % 139,663 4.5 % 201,736 6.5 % FMBI 17,404 18.4 % 4,252 4.5 % 6,141 6.5 % Tier 1 capital (1) (to average assets) Company 380,950 10.0 % 152,081 4.0 % — N/A Merchants Bank 399,815 11.0 % 145,723 4.0 % 182,154 5.0 % FMBI 17,404 10.8 % 6,453 4.0 % 8,066 5.0 % (1) As defined by regulatory agencies. Minimum Minimum Amount Required Amount To Be for Adequately Well Actual Capitalized (1) Capitalized (1) Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) December 31, 2017 Total capital (1) (to risk-weighted assets) Company $ 355,722 13.7 % $ 207,657 8.0 % $ — N/A Merchants Bank 406,638 15.7 % 207,567 8.0 % 259,459 10.0 % Tier I capital (1) (to risk-weighted assets) Company 347,411 13.4 % 155,743 6.0 % — N/A Merchants Bank 398,327 15.4 % 155,675 6.0 % 207,567 8.0 % Common Equity Tier I capital (1) (to risk-weighted assets) Company 305,830 11.8 % 116,807 4.5 % — N/A Merchants Bank 398,327 15.4 % 116,756 4.5 % 168,648 6.5 % Tier I capital (1) (to average assets) Company 347,411 10.9 % 127,318 4.0 % — N/A Merchants Bank 398,327 12.5 % 127,593 4.0 % 159,491 5.0 % (1) As defined by regulatory agencies. Beginning January 1, 2015, the Basel III Capital Rules applied to Merchants Bank. The following table lists the capital categories and ratios determined by the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation. Common Equity Total Risk-based Tier 1 Risk-based Tier 1 Risk-based Tier 1 Capital Category Capital ratio Capital ratio Capital ratio Leverage ratio Well capitalized 10 % 8 % 6.5 % 5 % Adequately capitalized 8 6 4.5 4 Undercapitalized <8 <6 <4.5 <4 Significantly undercapitalized <6 <4 <3 <3 Critically undercapitalized Tangible Equity/Total Assets </= 2% The Basel III Capital Rules, among other things, (i) include a capital measure called “Common Equity Tier 1” (CET1), (ii) specified that Tier 1 capital consist of CET1 and “Additional Tier 1 Capital” instruments meeting specified requirements, (iii) defined CET1 narrowly by requiring that most deductions/adjustments to regulatory capital measures be made to CET1 and not to the other components of capital and (iv) expanded the scope of the deductions/adjustments as compared to existing regulations. Under the Basel III Capital Rules, in order to avoid limitations on capital distributions of dividend payments and certain discretionary bonus payments to executive officers, a banking organization must hold a capital conservation buffer composed of capital above its minimum risk-based capital requirements. The implementation of the capital conservation buffer began on January 1, 2016, at the 0.625% level and was phased in over a four‑year period (increasing by that amount on each subsequent January 1 until it reached 2.5% on January 1, 2019). The Company’s principal source of funds for dividend payments to shareholders is dividends received from Merchants Bank. Banking regulations limit the maximum amount of dividends that a bank may pay without requesting prior approval of regulatory agencies. Under these regulations, the amount of dividends that may be paid in any calendar year is limited to Merchants Bank’s retained net income (as defined) for the current year plus those for the previous two years, subject to the capital requirements described above. At December 31, 2018, the amount available, without prior regulatory approval, for dividends which could be paid by Merchants Bank to the Company was $101.0 million.

Earnings Per Share

Earnings Per Share	12 Months Ended
	Dec. 31, 2018
Earnings Per share
Earnings Per share	Note 14: Earnings Per Share Earnings per share were computed as follows for years ended December 31, 2018, 2017 and 2016. Year Ended December 31, 2018 2017 2016 Weighted- Per Weighted- Per Weighted- Per Net Average Share Net Average Share Net Average Share Income Shares Amount Income Shares Amount Income Shares Amount (In thousands) (In thousands) (In thousands) Net income $ 62,874 $ 54,684 $ 33,127 Dividends on preferred stock (3,330) (3,330) (2,002) Net income allocated to common shareholders $ 59,544 $ 51,354 $ 31,125 Basic earnings per share 28,692,955 $ 2.08 22,551,452 $ 2.28 21,111,208 $ 1.47 Effect of dilutive securities—restricted stock awards 31,464 16,702 2,227 Diluted earnings per share 28,724,419 $ 2.07 22,568,154 $ 2.28 21,113,435 $ 1.47

Stock Splits

Stock Splits	12 Months Ended
	Dec. 31, 2018
Stock Splits
Stock Splits	Note 15: Stock Splits On July 5, 2017, the Company approved an increase of authorized common shares to 50.0 million shares, and declared a 2.5‑for‑1 stock split effective July 6, 2017. In February 2016, the Company declared a 2‑for‑1 stock split effective March 31, 2016. The presentation of authorized common shares has been retrospectively adjusted to give effect to the increase, and all share and per share amounts have been retrospectively adjusted to give effect to these splits.

Initial Public Offering of Comm

Initial Public Offering of Common Stock	12 Months Ended
	Dec. 31, 2018
Initial Public Offering of Common Stock
Initial Public Offering of Common Stock	Note 16: Initial Public Offering of Common Stock On October 26, 2017, the Company issued 6,250,000 shares of common stock in its initial public offering, and on November 2, 2017, the Company issued an additional 937,500 shares of common stock to the underwriters related to their exercise of an option to purchase additional shares. The aggregate gross offering proceeds for the shares issued by the Company was $115.0 million, and after deducting underwriting discounts and offering expenses of approximately $8.8 million paid to third parties, the Company received total net proceeds of $106.2 million.

Private Placement Offering of P

Private Placement Offering of Preferred Stock	12 Months Ended
	Dec. 31, 2018
Private Placement Offering of Preferred Stock
Private Placement Offering of Preferred Stock	Note 17: Private Placement Offering of Preferred Stock During 2016 the Company issued 31,625 shares of non‑cumulative, perpetual preferred stock at $1,000 per share for aggregate gross proceeds of $31.6 million and net proceeds after offering expenses of $31.6 million. During the fourth quarter of 2015, the Company issued 10,000 shares of non‑cumulative, perpetual preferred stock to certain related parties at $1,000 per share for aggregate gross proceeds of $10.0 million. All preferred shares are non‑voting. The preferred shares have an 8% yield and dividends are payable quarterly.

Related Party Transactions

Related Party Transactions	12 Months Ended
	Dec. 31, 2018
Related Party Transactions
Related Party Transactions	Note 18: Related Party Transactions The Company has entered into transactions with certain directors, executive officers and their affiliates or associates (related parties). Such transactions were made in the ordinary course of business on substantially the same terms and conditions, including interest rates and collateral, as those prevailing at the same time for comparable transactions with other customers, and did not, in the opinion of management, involve more than normal credit risk or present other unfavorable features. Deposits from related parties held by the Company at December 31, 2018 and 2017 totaled $11.1 million and $4.7 million, respectively. In 2016, the Company purchased a 30% ownership in one of its key loan processing vendors. The investment is accounted for using the equity method of accounting. Fees paid to this Company during the each of the years ended December 31, 2018 and 2017 were $3.4 million and $3.7 million. At December 31, 2018 and 2017, $226,000 and $253,000 was accrued for services received. The Company retained a law firm of which a Board member of Merchants Bank, and previously the Company through July 5, 2017, is a partner. Services rendered are primarily related to documentation of current loan originations, and loan collections from Merchants Bank’s borrowers. Fees paid to the law firm totaled $3.7 million, $3.0 million, and $2.1 million for the years ended December 31, 2018, 2017 and 2016 respectively. On May 8, 2017, the Company entered into a purchase agreement to acquire FMBI (formerly Joy State Bank) from Mr. Petrie, the Chairman/Chief Executive Officer and Mr. Rogers, the President/Chief Operating Officer of the Company. On October 31, 2016, Merchants Bank had entered into an Agreement and Plan of Merger to acquire FMBI. Because the timing and regulatory approval of the transaction was uncertain due to the Company’s capital position at September 30, 2016, the parties agreed that Messrs. Petrie and Rogers, would acquire FMBI. The acquisition of FMBI by the Messrs. Petrie and Rogers closed on April 3, 2017. The purchase agreement provided for Merchants Bank to pay a purchase price equal to approximately $5.4 million plus an approximate cost of funds of $16,000 for each 30 days after June 30, 2017, prorated to the closing date. The purchase price was equal to the price paid by Messrs. Petrie and Rogers, plus expenses and a cost of funds equal to 3.75%. The acquisition closed on January 2, 2018 at a total cost of approximately $5.5 million. At December 31, 2017 FMBI had $43 million in assets and $36.9 million of deposits.

Employee Benefits

Employee Benefits	12 Months Ended
	Dec. 31, 2018
Employee Benefits
Employee Benefits	Note 19: Employee Benefits Effective January 1, 2016, the Company discontinued its SIMPLE IRA plan and began offering a 401(k) plan. Pursuant to the plan agreement, matching contributions equal to 100% of the employees’ elective deferrals which do not exceed 3% of the employees’ compensation will be made unless management elects to make either the alternative matching contribution or the non‑elective contribution. Employer contributions to the plans were $464,000, $294,000, and $245,000 for the years ended December 31, 2018, 2017, and 2016, respectively.

Share-Based Payment Plans

Share-Based Payment Plans	12 Months Ended
	Dec. 31, 2018
Share-Based Payment Plans
Share-Based Payment Plans	Note 20: Share‑Based Payment Plan During 2016, the Board of Directors adopted an incentive restricted stock plan for certain executive officers of the Company, (the “2016 Plan”). Annual awards under the 2016 Plan could be earned, subject to certain performance metrics and the participating executive officer may elect annually to receive the plan benefit in the form of Company common shares or a combination of 50% each of common shares and cash. On July 5, 2017, the Company’s shareholders approved and the Company adopted the Merchants Bancorp 2017 Equity Incentive Plan (the “2017 Plan”). During the years ended December 31, 2018 and 2017, the Company issued 7,039 and 3,200 shares, respectively, pursuant to the 2016 Plan. Expense recognized for the Plan totaled $171,000, $458,000, and $57,000 for the years ended December 31, 2018, 2017, and 2016, respectively. At December 31, 2018 and 2017, there were 83,708 and 66,347 unvested shares awarded under the 2016 Plan, respectively. Unrecognized compensation cost totaled $1.1 million and $962,000 at December 31, 2018 and 2017, respectively. During 2018, the Compensation Committee of the Board of Directors approved a plan for non-executive directors to receive a portion of their annual fees in the form of common stock equal to $10,000, rounded up to the nearest whole share. Accordingly, there were 1,830 total shares issued during the year ended December 31, 2018, reflecting $50,000 in expenses. No shares were issued to directors during the year ended December 31, 2017.

Disclosures about Fair Value of

Disclosures about Fair Value of Assets and Liabilities	12 Months Ended
	Dec. 31, 2018
Disclosures about Fair Value of Assets and Liabilities
Disclosures about Fair Value of Assets and Liabilities	Note 21: Disclosures About Fair Value of Assets and Liabilities Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements must maximize the use of observable inputs and minimize the use of unobservable inputs. There is a hierarchy of three levels of inputs that may be used to measure fair value: Level 1 Quoted prices in active markets for identical assets or liabilities Level 2 Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities Level 3 Unobservable inputs supported by little or no market activity and are significant to the fair value of the assets or liabilities Recurring Measurements The following tables present the fair value measurements of assets recognized in the accompanying balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at December 31, 2018 and 2017: Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Fair Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) December 31, 2018 Trading securities $ 163,419 $ — $ 163,419 $ — Available-for-sale securities: Treasury notes 11,941 11,941 — — Federal agencies 236,930 — 236,930 — Municipals 21,332 — 21,332 — Mortgage-backed - Government-sponsored entity (GSE) - residential 60,868 — 60,868 — Loans held for sale 11,886 — 11,886 — Mortgage servicing rights 77,844 — — 77,844 Derivative assets - interest rate lock commitments 70 — — 70 Derivative liabilities - forward contracts 9 — 9 — December 31, 2017 Trading securities $ 140,837 $ — $ 140,837 $ — Available-for-sale securities: Treasury notes 992 992 — — Federal agencies 374,731 — 374,731 — Municipals 6,688 — — 6,688 Mortgage-backed - Government-sponsored entity (GSE) - residential 25,960 — 25,960 — Mortgage servicing rights 66,079 — — 66,079 Following is a description of the valuation methodologies and inputs used for assets measured at fair value on a recurring basis and recognized in the accompanying balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy. There have been no significant changes in the valuation techniques during the years ended December 31, 2018 and 2017. For assets classified within Level 3 of the fair value hierarchy, the process used to develop the reported fair value is described below. Trading and Available‑for‑Sale Securities Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. If quoted market prices are not available, then fair values are estimated by using quoted prices of securities with similar characteristics or independent asset pricing services and pricing models, the inputs of which are market‑based or independently sourced market parameters, including, but not limited to, yield curves, interest rates, volatilities, prepayments, defaults, cumulative loss projections and cash flows. Such securities are classified in Level 2 of the valuation hierarchy including federal agencies, mortgage‑backed securities, and FHA participation certificates. In certain cases where Level 1 or Level 2 inputs are not available, securities are classified within Level 3 of the hierarchy. Loans Held for Sale Certain loans held for sale at fair value are saleable into the secondary mortgage markets and their fair values are estimated using observable quoted market or contracted prices, or market price equivalents, which would be used by other market participants. These saleable loans are considered Level 2. Mortgage Servicing Rights Mortgage servicing rights do not trade in an active, open market with readily observable prices. Accordingly, fair value is estimated using discounted cash flow models having significant inputs of discount rate, prepayment speed, cost to service, and default rate. Due to the nature of the valuation inputs, mortgage servicing rights are classified within Level 3 of the hierarchy. The Chief Financial Officer’s (CFO) office contracts with a pricing specialist to generate fair value estimates on a quarterly basis. The CFO’s office challenges the reasonableness of the assumptions used and reviews the methodology to ensure the estimated fair value complies with accounting standards generally accepted in the United States. Derivative Financial Instruments The Company estimates the fair value of interest rate lock commitments based on the value of the underlying mortgage loan, quoted mortgage backed security prices, estimates of the fair value of the mortgage servicing rights, and an estimate of the probability that the mortgage loan will fund within the terms of the interest rate lock commitment, net of expenses. The Company estimates the fair value of forward sales commitments based on market quotes of mortgage backed security prices for securities similar to the ones used, which are considered Level 2. With respect to its interest rate lock commitments, management determined that a Level 3 classification was most appropriate based on the various significant unobservable inputs utilized in estimating the fair value of its interest rate lock commitments. Changes in fair value of the Company’s derivative financial instruments are recognized through noninterest income on its consolidated statement of income. Level 3 Reconciliation The following is a reconciliation of the beginning and ending balances of recurring fair value measurements recognized in the accompanying balance sheets using significant unobservable (Level 3) inputs: Year Ended December 31, 2018 2017 2016 (In thousands) Mortgage servicing rights Balance, beginning of period $ 66,079 $ 53,670 $ 55,553 Additions Originated and purchased servicing 14,113 10,993 5,745 Acquisition of MCS — 3,970 — Subtractions Paydowns (4,196) (5,504) (4,230) Changes in fair value due to changes in valuation inputs or assumptions used in the valuation model 1,848 2,950 (3,398) Balance, end of period $ 77,844 $ 66,079 $ 53,670 Available-for-sale securities - Municipals Balance, beginning of period $ 6,688 $ — $ — Additions Purchased securities — 6,688 — Subtractions Paydowns (257) — — Sales (6,431) — — Unrealized gains (losses) included in other comprehensive income — — — Balance, end of period $ — $ 6,688 $ — Derivative Assets - interest rate lock commitments Balance, beginning of period $ — $ — $ — Purchases — — Changes in fair value 70 — Balance, end of period $ 70 $ — $ — Nonrecurring Measurements The following table presents the fair value measurement of assets and liabilities measured at fair value on a nonrecurring basis and the level within the fair value hierarchy in which the fair value measurements fall at December 31, 2018 and 2017: Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Fair Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) December 31, 2018 Impaired loans (collateral-dependent) $ 2,639 $ — $ — $ 2,639 December 31, 2017 Impaired loans (collateral-dependent) $ 2,126 $ — $ — $ 2,126 Following is a description of the valuation methodologies and inputs used for assets measured at fair value on a nonrecurring basis and recognized in the accompanying balance sheet, as well as the general classification of such assets pursuant to the valuation hierarchy. For assets classified within Level 3 of the fair value hierarchy, the process used to develop the reported fair value is described below. Collateral‑Dependent Impaired Loans, Net of Allowance for Loan Losses The estimated fair value of collateral‑dependent impaired loans is based on the appraised or evaluated fair value of the collateral, less estimated cost to sell. Collateral‑dependent impaired loans are classified within Level 3 of the fair value hierarchy. The Company considers the appraisal or evaluation as the starting point for determining fair value and then considers other factors and events in the environment that may affect the fair value. Appraisals or evaluations of the collateral underlying collateral‑dependent loans are obtained when the loan is determined to be collateral‑dependent and subsequently as deemed necessary by the Chief Credit Officer’s (CCO) office. Appraisals and evaluations are reviewed for accuracy and consistency by the CCO’s office. Appraisers are selected from the list of approved appraisers maintained by management. The appraised or evaluated values are reduced by discounts to consider lack of marketability and estimated cost to sell if repayment or satisfaction of the loan is dependent on the sale of the collateral. These discounts and estimates are developed by the CCO’s office by comparison to historical results. Unobservable (Level 3) Inputs: The following table presents quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than goodwill. Valuation Fair Value Technique Unobservable Inputs Range (In thousands) At December 31, 2018: Collateral-dependent impaired loans $ 2,639 Market comparable properties Marketability discount 17%-59% Mortgage servicing rights $ 77,844 Discounted cash flow Discount rate 8% - 13% Constant prepayment rate 1% - 30% Derivative assets - interest rate lock commitments $ 70 Discounted cash flow loan closing rates 95-100% At December 31, 2017: Collateral-dependent impaired loans $ 2,126 Market comparable properties Marketability discount 5% - 47% Mortgage servicing rights $ 66,079 Discounted cash flow Discount rate 8% - 13% Constant prepayment rate 1% - 36% At December 31, 2017, municipal securities of $6.7 million were classified as Level 3, as there was no active market for these or similar securities. These securities were purchased on December 28, 2017, as such, they were valued as of December 31, 2017 at their purchase price. These securities were sold as of December 31, 2018. Sensitivity of Significant Unobservable Inputs The following is a discussion of the sensitivity of significant unobservable inputs, the interrelationships between those inputs and other unobservable inputs used in recurring fair value measurement and of how those inputs might magnify or mitigate the effect of changes in the unobservable inputs on the fair value measurement. Mortgage Servicing Rights The significant unobservable inputs used in the fair value measurement of the Company’s mortgage servicing rights are discount rates and constant prepayment rates. Significant increases or decreases in any of those inputs in isolation would result in a significantly different fair value measurement. Fair Value of Financial Instruments The following tables present estimated fair values of the Company’s financial instruments and the level within the fair value hierarchy in which the fair value measurements fall at December 31, 2018 and 2017. Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Carrying Fair Assets Inputs Inputs Assets Value Value (Level 1) (Level 2) (Level 3) (In thousands) December 31, 2018 Financial assets: Cash and cash equivalents $ 336,524 $ 336,524 $ 336,524 $ — $ — Securities purchased under agreements to resell 6,875 6,875 — 6,875 — FHLB stock 7,974 7,974 — 7,974 — Loans held for sale 820,569 820,569 — 820,569 — Loans, net 2,045,423 2,041,772 — — 2,041,772 Interest receivable 13,827 13,827 — 13,827 — Financial liabilities: Deposits 3,231,086 3,230,397 2,550,632 679,765 — Lines of credit 33,150 33,150 — 33,150 — Short-term subordinated debt 10,582 10,582 — 10,582 — FHLB advances 151,721 151,723 — 151,723 — Interest payable 4,132 4,132 — 4,132 — December 31, 2017 Financial assets: Cash and cash equivalents $ 359,519 $ 359,519 $ 359,519 $ — $ — Securities purchased under agreements to resell 7,043 7,043 — 7,043 — FHLB stock 7,539 7,539 — 7,539 — Loans held for sale 995,319 995,319 — 995,319 — Loans, net 1,366,349 1,364,568 — — 1,364,568 Interest receivable 8,326 8,326 — 8,326 — Financial liabilities: Deposits 2,943,561 2,943,173 2,534,605 408,568 — Line of credit 25,000 25,000 — 25,000 — Short-term subordinated debt 30,000 30,000 — 30,000 — FHLB advances 1,612 1,620 — 1,620 — Interest payable 2,817 2,817 — 2,817 — The following methods were used to estimate the fair value of all other financial instruments recognized in the accompanying balance sheets at amounts other than fair value. Cash and Cash Equivalents and Securities Purchased Under Agreement to Resell The carrying amount approximates fair value. Federal Home Loan Bank Stock The fair value of FHLB stock is based on the price at which it may be sold to the FHLB. Loans Held For Sale The carrying amount approximates fair value due to the insignificant time between origination and date of sale. Loans Fair value is estimated by discounting the future cash flows using the market rates at which similar notes would be made to borrowers with similar credit ratings and for the same remaining maturities. The market rates used are based on current rates the Company would impose for similar loans and reflect a market participant assumption about risks associated with nonperformance, illiquidity, and the structure and term of the loans along with local economic and market conditions. Interest Receivable and Payable The carrying amount approximates fair value. The carrying amount is determined using the interest rate, balance and last payment date. Deposits The fair values of noninterest‑bearing demand and savings accounts are equal to the amount payable on demand at the balance sheet date. Fair values for fixed‑rate certificates and time deposits are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of expected monthly maturities on such time deposits. Lines of Credit and Short‑term Subordinated Debt The carrying amount approximates fair value. Federal Home Loan Bank Advances Fair value is estimated by discounting the future cash flows using rates of similar advances with similar maturities. These rates were obtained from current rates offered by the FHLB. Off‑Balance Sheet Commitments Commitments include commitments to purchase and originate mortgage loans, commitments to sell mortgage loans and standby letters of credit and are generally of a short‑term nature. The fair value of such commitments are based on fees currently charged to similar agreements, taking into account the remaining terms of the agreements and the counterparties’ credit standing. The fair value of commitments to extend credit and letters of credit is not presented in the previous table since the fair value is considered to be insignificant.

Significant Estimates and Conce

Significant Estimates and Concentrations	12 Months Ended
	Dec. 31, 2018
Significant Estimates and Concentrations
Significant Estimates and Concentrations	Note 22: Significant Estimates and Concentrations Accounting principles generally accepted in the United States of America require disclosure of certain significant estimates and current vulnerabilities due to certain concentrations. Estimates related to the provision and allowance for loan losses are reflected in the footnotes regarding loans and the allowance for loan losses (Notes 1 and 4). Estimates related to mortgage servicing rights are reflected in the notes on mortgage servicing rights and loan servicing (Notes 1 and 6). Estimates related to fair values are reflected in the footnote regarding fair values (Note 21). Current vulnerabilities due to certain concentrations of credit risk are discussed in the footnote on commitments, credit risk, and contingencies (Note 23). Other significant estimates and concentrations not discussed in those footnotes include: Mortgage‑backed Securities and Secondary Mortgage Market Programs The Company is involved in government programs for issuing mortgage‑backed securities (MBS). The objective of these programs is to facilitate secondary market activities in order to provide funding for the multi‑family mortgage market. The Company is subject to cancellation of secondary mortgage market programs, rapid increases in general interest rates, and competition associated with conventional mortgage programs. In addition, the Company could be responsible for covering shortfalls in amounts due to investors for delinquencies or foreclosures. No amounts have been reported in the consolidated financial statements since management believes that no near term financial losses will be incurred and these MBS programs will not be significantly affected by the controlling regulatory bodies. Major Customer The Company had no major customers whose business represented more than 10% of revenues during the year ended December 31, 2018. For the years ended December 31, 2017 and 2016 the Company had a major customer of the Mortgage Warehousing segment, whose business represented $14.3 million and $14.7 million, or 10% and 15% of total revenues, respectively.

Commitments and Credit Risk

Commitments and Credit Risk	12 Months Ended
	Dec. 31, 2018
Commitments and Credit Risk
Commitments and Credit Risk	Note 23: Commitments, Credit Risk, and Contingencies In the normal course of business the Company enters into funding commitments with customers who have applied for single and multi‑family residential loans. The customers must meet certain credit and underwriting criteria before the Company is required to fund the loans. The Company entered into commitments to fund loans pending closing of $507.2 million and $221.3 million at December 31, 2018 and 2017, respectively. Closing and funding of the majority of these loans is contingent upon various performance criteria by the potential borrower and the commitment may be rescinded by the Company. The Company enters into a corresponding sales commitment if it is the Company’s intent to close the loan and to sell the loan after closing. The Company, through the Multi-family Mortgage Banking segment, has made commitments to fund construction loans that are drawn upon throughout the construction period. Undisbursed commitments on these loans were $457.8 million and $101.1 million at December 31, 2018 and 2017, respectively. The Company, through the Mortgage Warehousing segment, has line of credit agreements with its non‑depository financial institution customers engaged in mortgage lending. Funds drawn on the lines of credit are used by the borrowers to fund the loans they originate. The customers’ loans must meet certain credit and underwriting criteria before the Company will fund the draw requests on the lines of credit, and the draw requests can be denied by the Company. The outstanding amounts available on these lines of credit totaled $782.4 million and $613.8 million at December 31, 2018 and 2017, respectively. Additionally, in the normal course of business the Company has outstanding unfunded commitments and contingent liabilities, such as commitments to extend credit and standby letters of credit, which are not included in the accompanying financial statements. The Company’s exposure to credit loss in the event of nonperformance by the other party to the financial instruments for commitments to extend credit and standby letters of credit is represented by the contractual or notional amount of those instruments. The Company uses the same credit policies in making such commitments as it does for instruments that are included in the consolidated balance sheet. Financial instruments, whose contract amount represents credit risk, were as follows at December 31, 2018 and 2017: December 31, 2018 2017 (In thousands) Commitments to extend credit $ 676,987 $ 437,585 Irrevocable standby letters of credit 3,164 26,000 Commitment letters of credit 19,866 31,031 Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Company evaluates each customer’s credit worthiness on a case‑by‑case basis. The amount of collateral obtained, if deemed necessary by the Company upon extension of credit, is based on management’s credit evaluation. Collateral held varies but may include accounts receivable, inventory, property and equipment, and income‑producing commercial properties. Commitment letters of credit are conditional commitments issued by the Company for a fee to guarantee the performance of a customer to a third party. Standby letters of credit generally have fixed expiration dates or other termination clauses. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan commitments to customers. The Company’s policy for obtaining collateral and/or guarantees and the nature thereof is generally the same as that involved extending commitments to its customers. The Company has not been required to fund nor has it incurred any losses on any letter of credit commitment during the years ended December 31, 2018 or 2017. The Company has several non-cancellable operating leases, primarily for office space, that expire over the next 1‑7 years. Rental expense for these leases was $1.1 million, $764,000, and $696,000 for the years ended December 31, 2018, 2017 and 2016, respectively. Future minimum lease payments under operating leases as of December 31, 2018 are as follows: December 31, 2018 (In thousands) Due within one year $ 1,021 Due in one year to two years 1,085 Due in two years to three years 736 Due in three years to four years 550 Due in four years to five years 554 Thereafter 426 Total minimum lease payments $ 4,372 The Company and its subsidiaries are parties to various claims and proceedings arising in the normal course of business. Currently, the Company and its subsidiaries are defendants in a litigation matter pending in Indiana state court for breach of contract related to a warehouse credit facility. Management, after consultation with legal counsel, believes that the liabilities, if any, arising from such proceedings and claims will not be material to the Company’s consolidated financial position or results of operations.

Segment Information

Segment Information	12 Months Ended
	Dec. 31, 2018
Segment Information
Segment Information	Note 24: Segment Information The Company’s business segments are defined as Multi‑family Mortgage Banking, Mortgage Warehousing, and Banking. The reportable business segments are consistent with the internal reporting and evaluation of the principal lines of business of the Company. The Multi‑family Mortgage Banking segment originates and services government sponsored mortgages for multi‑family and healthcare facilities. The Mortgage Warehousing segment funds agency eligible residential loans from origination or purchase to sale in the secondary market, as well as commercial loans to non‑depository financial institutions. The Banking segment provides a wide range of financial products and services to consumers and businesses, including commercial, commercial real estate, mortgage and other consumer loan products; letters of credit; various types of deposit products, including checking, savings and time deposit accounts. Other includes general and administrative expenses that provide services to all segments; internal funds transfer pricing offsets resulting from allocations to/from the other segments; certain elimination entries and investments in qualified affordable housing limited partnerships. All operations are domestic. The tables below present selected business segment financial information for the years ended December 31, 2018, 2017 and 2016. Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Year Ended December 31, 2018 Total interest income $ 712 $ 58,784 $ 79,332 $ 1,735 $ 140,563 Total interest expense — 24,369 29,508 (3,285) 50,592 Net interest income 712 34,415 49,824 5,020 89,971 Provision for loan losses — 1,372 3,257 — 4,629 Net interest income after provision for loan losses 712 33,043 46,567 5,020 85,342 Total noninterest income 45,831 2,550 3,150 (1,946) 49,585 Noninterest expense 19,205 7,721 14,876 9,098 50,900 Income before income taxes 27,338 27,872 34,841 (6,024) 84,027 Income taxes 7,528 6,872 8,572 (1,819) 21,153 Net income $ 19,810 $ 21,000 $ 26,269 $ (4,205) $ 62,874 Total assets $ 166,102 $ 1,430,776 $ 2,256,687 $ 30,598 $ 3,884,163 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Year Ended December 31, 2017 Total interest income $ 414 $ 48,798 $ 44,454 $ 721 $ 94,387 Total interest expense — 13,673 14,853 (736) 27,790 Net interest income 414 35,125 29,601 1,457 66,597 Provision for loan losses — 452 2,020 — 2,472 Net interest income after provision for loan losses 414 34,673 27,581 1,457 64,125 Total noninterest income 43,715 2,836 1,943 (814) 47,680 Noninterest expense 10,911 7,710 9,835 6,188 34,644 Income before income taxes 33,218 29,799 19,689 (5,545) 77,161 Income taxes 4,557 11,558 8,279 (1,917) 22,477 Net income $ 28,661 $ 18,241 $ 11,410 $ (3,628) $ 54,684 Total assets $ 134,390 $ 1,352,748 $ 1,889,140 $ 16,855 $ 3,393,133 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Year Ended December 31, 2016 Total interest income $ 237 $ 43,352 $ 29,350 $ — $ 72,939 Total interest expense — 11,235 6,546 1,187 18,968 Net interest income 237 32,117 22,804 (1,187) 53,971 Provision for loan losses — (247) 1,207 — 960 Net interest income after provision for loan losses 237 32,364 21,597 (1,187) 53,011 Total noninterest income 22,798 3,220 2,486 — 28,504 Noninterest expense 7,474 7,730 8,383 3,133 26,720 Income before income taxes 15,561 27,854 15,700 (4,320) 54,795 Income taxes 6,153 11,015 6,208 (1,708) 21,668 Net income $ 9,408 $ 16,839 $ 9,492 $ (2,612) $ 33,127 Total assets $ 98,553 $ 1,060,723 $ 1,545,783 $ 13,453 $ 2,718,512

Condensed Financial Information

Condensed Financial Information (Parent Company Only)	12 Months Ended
	Dec. 31, 2018
Condensed Financial Information (Parent Company Only)
Condensed Financial Information (Parent Company Only)	Note 25: Condensed Financial Information (Parent Company Only) Presented below is condensed financial information of the Company as to financial position as of December 31, 2018 and 2017, and results of operations and cash flows for the years ended December 31, 2018, 2017 and 2016: Condensed Balance Sheets December 31, 2018 2017 (In thousands) Assets Cash and cash equivalents $ 2,224 $ 7,273 Investment in subsidiaries 453,028 411,528 Other assets 2,104 5,597 Total assets $ 457,356 $ 424,398 Liabilities Lines of credit $ 25,000 $ 25,000 Short-term subordinated debt 10,582 30,000 Other liabilities 537 1,924 Total liabilities 36,119 56,924 Shareholders’ Equity 421,237 367,474 Total liabilities and shareholders’ equity $ 457,356 $ 424,398 Condensed Statements of Income and Comprehensive Income Year Ended December 31, 2018 2017 2016 (In thousands) Income Dividends and return of capital from subsidiaries 37,816 13,632 16,223 Other Income 195 208 196 Total income 38,011 13,840 16,419 Expenses Interest expense 8,055 7,603 7,237 Salaries and employee benefits 1,216 1,617 77 Professional fees 707 341 138 Other 420 251 33 Total expense 10,398 9,812 7,485 Income Before Income Tax and Equity in Undistributed Income of Subsidiaries 27,613 4,028 8,934 Income Tax Benefit (2,542) (3,670) (2,885) Income Before Equity in Undistributed Income of Subsidiaries 30,155 7,698 11,819 Equity in Undistributed Income of Subsidiaries 32,719 46,986 21,308 Net Income $ 62,874 $ 54,684 $ 33,127 Comprehensive Income $ 63,813 $ 54,306 $ 32,731 Condensed Statements of Cash Flows Year Ended December 31, 2018 2017 2016 (In thousands) Operating Activities Net income $ 62,874 $ 54,684 $ 33,127 Adjustments to reconcile net income to net cash used in operating activities (30,522) (44,185) (26,561) Net cash provided by operating activities 32,352 10,499 6,566 Investing Activities Return of capital from/(contributed capital to) subsidiaries 19,368 (101,868) (31,625) Net cash paid for acquisitions (27,209) — — Other investing activity 74 189 (295) Net cash used in investing activities (7,767) (101,679) (31,920) Financing Activities Net change in short-term subordinated debt (19,418) — — Dividends paid (10,216) (7,950) (6,224) Proceeds from issuance of common stock — 106,245 — Proceeds from issuance of preferred stock — — 31,581 Net cash provided by (used in) financing activities (29,634) 98,295 25,357 Net Change in Cash and Due From Banks (5,049) 7,115 3 Cash and Due From Banks at Beginning of Year 7,273 158 155 Cash and Due From Banks at End of Year $ 2,224 $ 7,273 158

Recent Accounting Pronouncement

Recent Accounting Pronouncements	12 Months Ended
	Dec. 31, 2018
Recent Accounting Pronouncements
Recent Accounting Pronouncements	Note 26: Recent Accounting Pronouncements The Company is an emerging growth company and as such will be subject to the effective dates noted for the private companies if they differ from the effective dates noted for public companies. FASB ASU 2014‑09, Revenue from Contracts with Customers In May 2014, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2014‑09, “Revenue from Contracts with Customers,” which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. In March 2016 the FASB issued ASU 2016‑08, “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” which clarifies the guidance in determining revenue recognition as principal versus agent. In April 2016, the FASB issued ASU 2016‑10, “Identifying Performance Obligations and Licensing,” which provides guidance in accounting for immaterial performance obligations and shipping and handling. In May 2016, the FASB issued ASU 2016‑12, “Narrow‑Scope Improvements and Practical Expedients,” which provides clarification on assessing the collectability criterion, presentation of sales taxes, measurement date for noncash consideration and completed contracts at transition. This ASU also provides a practical expedient for contract modifications. As an emerging growth company, these amendments are effective for annual reporting periods beginning after December 15, 2018, and for interim periods within annual periods beginning after December 15, 2019. The Company’s revenue is primarily comprised of net interest income on financial assets and financial liabilities, which is explicitly excluded from the scope of ASU 2014-09. The Company has evaluated the impact of adopting ASU 2014-09, but does not expect the impact to have a material impact on the Company’s financial position or results of operations. FASB ASU 2016‑01, Recognition and Measurement of Financial Assets and Financial Liabilities In January 2016, the FASB issued ASU 2016‑01, “Recognition and Measurement of Financial Assets and Financial Liabilities.” For public business entities, the amendments in this update include the elimination of the requirement to disclose the method(s) and significant assumptions used to estimate fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, the requirement to use the exit price notion when measuring fair value of financial instruments for disclosure purposes, the requirement to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument‑specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments, the requirement for separate presentation of financial assets and financial liabilities by measurement category and form of financial asset (that is, securities or loans and receivables) on the balance sheet or accompanying notes to the financial statements, and the amendments clarify that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available‑for‑sale securities in combination with the entity’s other deferred tax assets. An entity should apply the amendments to this update by means of a cumulative‑effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. As an emerging growth company, the amendments in this update are effective for fiscal years beginning after December 15, 2018, and interim periods within years beginning after December 15, 2019. Early adoption of the amendments in the update is not permitted, except that early application by public business entities to financial statements of fiscal years or interim periods that have not yet been issued or, by all other entities, that have not yet been made available for issuance, are permitted as of the beginning of the fiscal year of adoption for the following amendment: An entity should present separately in other comprehensive income the portion of the total change in the fair value of a liability at fair value in accordance with the fair value option for financial instruments. An entity should apply the amendments to this update by means of a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. The Company is continuing to evaluate the impact of adopting this new guidance on its consolidated financial statements, but the adoption of ASU 2016-01 is not expected to have a material impact on the Company’s financial position or results of operation. FASB ASU 2016‑02, Leases In February 2016, the FASB issued ASU 2016‑02, “Leases.” Under the new guidance, lessees will be required to recognize the following for all leases (with the exception of short‑term leases) at the commencement date: · A lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and · A right‑of‑use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Under the new guidance, lessor accounting is largely unchanged. Certain targeted improvements were made to align, where necessary, lessor accounting with the lessee accounting model and Topic 606, “Revenue from Contracts with Customers.” The new lease guidance simplified the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. Lessees will no longer be provided with a source of off‑balance sheet financing. Lessees (for capital and operating leases) and lessors (for sales‑type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. The amendments in ASU 2016‑02 are effective, as an emerging growth company, beginning after December 15, 2019, and for interim periods for years beginning after January 1, 2020. Management is in the process of gathering documentation on current lease agreements to assess the impact of adopting this guidance on the Company’s financial statements, but its impact is not expected to be material. FASB ASU 2016‑13, Financial Instruments—Credit Losses In June 2016, the FASB issued ASU 2016‑13, “Financial Instruments—Credit Losses”. The amendments in this ASU replace the incurred loss model with a methodology that reflects expected credit losses over the life of the loan and requires consideration of a broader range of reasonable and supportable information to calculate credit loss estimates. ASU 2016‑13 replaces the incurred loss impairment methodology with a new methodology that reflects expected credit losses over the lives of the loans and requires consideration of a broader range of information to form credit loss estimates. The ASU requires an organization to estimate all expected credit losses for financial assets measured at amortized cost, including loans and held‑to‑maturity debt securities, based on historical experience, current conditions, and reasonable and supportable forecasts. Additional disclosures are required. As an emerging growth company, ASU 2016‑13 is effective, for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years beginning after December 15, 2021. The Company has established a cross-functional committee that is developing a project plan to review modeling data currently available and technology needed to ensure compliance of this standard. The committee has also met with multiple vendors to potentially assist in generating specific loan level details within our core systems, as well as compiling peer and industry data that would be useful in our modeling forecasts. While the Company generally expects to recognize a one-time cumulative effect adjustment to the allowance for loan losses as of the beginning of the first reporting period in which the new standard is effective, the Company cannot yet determine the magnitude of any such one-time adjustment or the overall impact of the new guidance on the Company’s consolidated financial statements. Management continues to expect that the implementation of this ASU may increase the balance of the allowance for loan losses and is continuing to evaluate the potential impact on the Company’s financial position and results of operations. FASB ASU No. 2017‑04, Intangibles—Goodwill and Other (Topic 350) In January 2017, the FASB issued ASU 2017‑04, “Intangibles—Goodwill and Other (Topic 350).” This ASU simplifies the test for goodwill impairment. Specifically, these amendments eliminate Step 2 from the goodwill impairment test, and also eliminate the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment and, if it fails that qualitative test, to perform Step 2 of the goodwill impairment test. As an emerging growth company, the amendments in this ASU are effective for annual goodwill impairment tests in fiscal years beginning after December 15, 2021. Management continues to believe that the changes will not have a material effect on the Company’s financial position and results of operations. FASB ASU 2017‑08, Premium Amortization on Purchased Callable Debt In March 2017, the FASB issued ASU 2017‑08, “Premium Amortization on Purchased Callable Debt.” This ASU applies to all entities that hold investments in callable debt securities that have an amortized cost basis in excess of the amount that is repayable by the issuer at the earliest call date (that is, at a premium). The ASU requires the premium to be amortized to the earliest call date, not the maturity date. The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. As an emerging growth company, ASU 2017‑08 is effective as to the Company for years beginning after December 15, 2019 and interim periods within years beginning after December 15, 2020. Early adoption is permitted. Management is still in the process of evaluating the impact of adopting this guidance, but does not expect the ASU to have a material effect on the Company’s financial position or results of operations. FASB ASU 2018-02 , Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In February 2018, the FASB issued ASU No. 2018-02, “Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income.” The amendments in this ASU allow a reclassification from accumulated other comprehensive income (AOCI) to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. Consequently, the amendments eliminate the stranded tax effects resulting from the Tax Cuts and Jobs Act and will improve the usefulness of information reported to financial statement users. The amendments in this ASU also require certain disclosures about stranded tax effects. The amendments in this ASU are effective for all entities for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption of the amendments in this ASU is permitted, including adoption in any interim period, (1) for public business entities for reporting periods for which financial statements have not yet been issued and (2) for all other entities for reporting periods for which financial statements have not yet been made available for issuance. The amendments in this ASU should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. At December 31, 2017, the Company had approximately $243,000 stranded tax effects included in AOCI. The Company adopted this ASU in the first quarter of 2018.

Quarterly Condensed Financial I

Quarterly Condensed Financial Information (Unaudited)	12 Months Ended
	Dec. 31, 2018
Quarterly Condensed Financial Information (Unaudited)
Quarterly Condensed Financial Information (Unaudited)	Note 27: Quarterly Condensed Financial Information (Unaudited) The following tables present the unaudited quarterly condensed financial information for the years ended December 31, 2018 and 2017: 2018 Quarter Ended (Dollars in thousands, except per share data) March 31 June 30 September 30 December 31 Interest income $ 29,038 $ 34,123 $ 37,577 $ 39,825 Interest expense 8,930 11,917 14,095 15,650 Net interest income 20,108 22,206 23,482 24,175 Provision for loan losses 1,406 998 617 1,608 Net interest income after provision for loan losses 18,702 21,208 22,865 22,567 Noninterest income 11,313 11,630 11,907 14,735 Noninterest expense 10,270 12,000 12,449 16,181 Income before income taxes 19,745 20,838 22,323 21,121 Income taxes 4,684 5,186 5,584 5,699 Net income 15,061 15,652 16,739 15,422 Less: preferred stock dividends 833 832 833 832 Net income allocated to common shareholders $ 14,228 $ 14,820 $ 15,906 $ 14,590 Per common share data: Basic earnings per common share $ 0.50 $ 0.52 $ 0.55 $ 0.51 Diluted earnings per common share 0.50 0.52 0.55 0.51 2017 Quarter Ended (Dollars in thousands, except per share data) March 31 June 30 September 30 December 31 Interest income $ 19,007 $ 22,464 $ 26,006 $ 26,910 Interest expense 5,476 6,740 7,616 7,958 Net interest income 13,531 15,724 18,390 18,952 Provision for loan losses 240 240 592 1,400 Net interest income after provision for loan losses 13,291 15,484 17,798 17,552 Noninterest income 8,091 16,626 8,056 14,907 Noninterest expense 6,641 8,261 8,942 10,800 Income before income taxes 14,741 23,849 16,912 21,659 Income taxes 5,611 9,091 6,445 1,330 Net income 9,130 14,758 10,467 20,329 Less: preferred stock dividends 832 832 833 833 Net income allocated to common shareholders $ 8,298 $ 13,926 $ 9,634 $ 19,496 Per common share data: Basic earnings per common share $ 0.39 $ 0.66 $ 0.45 $ 0.73 Diluted earnings per common share 0.39 0.66 0.45 0.73

Subsequent Events

Subsequent Events	12 Months Ended
	Dec. 31, 2018
Subsequent Events
Subsequent Events	Note 28: Subsequent Events No material events were noted.

Nature of Operations and Summ_2

Nature of Operations and Summary of Significant Accounting Policies (Policies)	12 Months Ended
	Dec. 31, 2018
Nature of Operations and Summary of Significant Accounting Policies
Nature of Operations and Principles of Consolidation	Nature of Operations and Principles of Consolidation The accompanying consolidated financial statements include the accounts of Merchants Bancorp, a registered bank holding company (the “Company”) and its wholly owned subsidiaries, Merchants Bank of Indiana (“Merchants Bank”) and Farmers-Merchants Bank of Illinois (“FMBI,” formerly Joy State Bank prior to October 22, 2018). Merchants Bank’s direct and indirect subsidiaries include Merchants Capital Corp. (“MCC,” formerly P/R Mortgage and Investment Corp prior to October 1, 2018), Merchants Capital Servicing, LLC (“MCS,” formerly RICHMAC Funding, LLC prior to November 1, 2018), Ash Realty Holdings, LLC (“Ash Realty”), MBI Midtown West, LLC (“MMW”), Natty Mac Funding, Inc. (“NMF”), and OneTrust Funding, Inc. The Company also acquired Farmers-Merchants National Bank of Paxton (‘FMNBP”) on October 1, 2018 through a merger with FMBI, with FMBI as the surviving entity. All these entities are collectively referred to as the “Company”. All significant intercompany accounts and transactions have been eliminated in consolidation. Merchants Bank operates under an Indiana state bank charter and provides full banking services. As a state bank and non-Federal Reserve member, it is subject to the regulation of the Indiana Department of Financial Institutions (“IDFI”) and the Federal Deposit Insurance Corporation (“FDIC”). The Company is further subject to regulations of the Board of Governors of the Federal Reserve System (“Federal Reserve”) governing bank holding companies. Merchants Bank operates from four locations in Indiana, including Lynn, Spartanburg, Carmel and Indianapolis. Merchants Bank generates commercial, mortgage and consumer loans and receives deposits from customers located primarily in Hamilton, Randolph and surrounding counties in Indiana. Merchants Bank’s loans are generally secured by specific items of collateral including real property, consumer assets and business assets. Merchants Bank’s Mortgage Warehousing segment funds and participates in single family and multi‑family, agency eligible loans across the nation. FMBI operates under an Illinois state bank charter and provides full banking services. As a state bank and non-Federal Reserve member, it is subject to the regulation of the Illinois Department of Financial and Professional Regulation (“IDFPR”) and the FDIC. FMBI operates from five locations in Illinois, including Joy, New Boston, Paxton, Melvin, and Piper City. MCC was formed in August 1990, in the state of Indiana. MCC is primarily engaged in mortgage banking, specializing in lending for multi‑family rental properties and healthcare facilities. It is an FHA approved mortgagee and a Ginnie Mae, Fannie Mae, and Freddie Mac issuer. In August 2012, Merchants Bank established a qualifying subsidiary, Ash Realty, for the purpose of acquiring, holding and liquidating real estate acquired by Merchants Bank as a result of various foreclosures. NMF was formed in April 2014, in the state of Indiana. Prior to the Company acquiring all the assets of NattyMac Funding, LLC from Home Point Financial Corporation (“Home Point”) on December 31, 2018, NMF provided loan participations and participation warehouse financing to Home Point, its subsidiaries, and customers. MMW was formed in 2016 to hold land and improvements for the Company’s new headquarters building that is expected to be complete in the summer of 2019. OneTrust Funding, Inc. was formed in April 2018, in the state of Indiana, to facilitate warehouse financing arrangements, similar to those between NMF and Home Point.
Recent Acquisitions	Recent Acquisitions On August 15, 2017, Merchants Bank acquired 100% of the equity interests of MCS (formerly RICHMAC Funding, LLC), which was a national multi-family housing mortgage lender and servicer. The purchase price was paid in shares of Company common stock with a value of $8.1 million. As of December 31, 2018, the Company recorded goodwill and intangible assets totaling $3.8 million and $1.6 million, respectively, in connection with the acquisition. As a result of the acquisition, the Company expanded its product offerings and benefited from economies of scale. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. On May 8, 2017, the Company entered into a Stock Purchase Agreement to acquire FMBI (formerly Joy State Bank). The acquisition closed on January 2, 2018 at a total cost of approximately $5.5 million. At December 31, 2017 Joy State Bank had $43 million in assets. The Company recorded goodwill and intangible assets totaling $988,000 and $478,000, respectively, in connection with the acquisition. The intangible assets consisted of core deposit intangibles that are being amortized over 10 years on an accelerated basis. The acquired time deposits of $16.7 million were recorded at a fair value of $16.9 million. The fair value premium of $185,000 is being accreted against interest expense over 20 months. The acquired loan portfolio of $27.9 million was recorded at a fair value of $27.5 million. The fair value discount of $458,000 is being accreted to interest income on a straight-line basis over an average of 39 months in accordance with ASC 310-20. While there were some loans identified for potential classification under ASC 310-30, they were not material to the transaction. On October 22, 2018, the Company changed the name of Joy State Bank to Farmers-Merchants Bank of Illinois (“FMBI”). Certain fair value measurements and the purchase price allocation are still being evaluated by management and are subject to change during the measurement period. As a result of the acquisition, the Company increased its deposit base and benefited from economies of scale. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. On October 1, 2018, the Company acquired FM Bancorp, Inc., a bank holding company, and its wholly owned subsidiary, Farmers-Merchants National Bank of Paxton (“FMNBP”). On that date, FM Bancorp, Inc. ultimately merged with and into the Company, with the Company as the surviving entity, and FMNBP merged with and into Joy State Bank, with Joy State Bank as the surviving bank. Effective October 22, 2018, Joy State Bank’s name changed to Farmers-Merchants Bank of Illinois (“FMBI”). Under the terms of the merger agreement, shareholders of the 27,537 outstanding shares of FM Bancorp, Inc. were compensated $795.29 per share, for a total purchase price of $21.9 million. As of September 30, 2018, FM Bancorp, Inc. and Farmers-Merchants National Bank of Paxton had total assets of approximately $110.0 million, available for sale securities of $66.3 million, deposits of approximately $95.7 million, and net loan receivables of approximately $35.0 million. The Company recorded goodwill and intangible assets totaling $7.2 million and $1.9 million. The intangible assets consisted of core deposit intangibles that are being amortized over 10 years on an accelerated basis. The acquired available for sale securities of $66.3 million were recorded at fair value. A fair value discount associated with securities of $1.0 million is being accreted into interest income, in accordance with ASC 310-20. While there were some loans identified for potential classification under ASC 310-30, they were not material to the transaction. The acquired gross loan portfolio of $35.4 million was recorded at a fair value of $34.8 million. The fair value discount of $625,000 includes a discount related to interest assumptions for $279,000 and to credit assumptions for $346,000. The portion related to interest assumptions is being accreted into interest income on a straight-line basis over an average of 72 months in accordance with ASC 310-20. The discount portion related to credit assumptions is being accreted into interest income over the life of the loan. The acquired deposits of $95.7 million were recorded at a fair value of $95.7 million. Certain fair value measurements and the purchase price allocation are still being evaluated by management and are subject to change during the measurement period. As a result of the acquisition, the Company increased its deposit base and benefited from economies of scale. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. On December 31, 2018, the Company acquired the assets of NattyMac, LLC, a warehouse lender operating out of Clearwater, Florida, from Home Point Financial Corporation (“Home Point”). The Company also fully repaid Home Point the balance of, and all interest owed on, the $30 million subordinated debt it had previously invested in the Company. Goodwill totaling $5.0 million was recorded by the Company. Certain fair value measurements, intangibles, and the purchase price allocation are still being evaluated by management and are subject to change during the measurement period. As a result of the acquisition, the Company expects to increase its geographic footprint in the warehouse business, reduce its costs of borrowing, increase the earnings generated from its warehouse business, and benefit from its experienced talent pool. The acquisition did not materially impact the Company’s financial position, results of operations or cash flows. Given the impact of the acquisitions was immaterial to the Company and its results of operations, pro forma information has not been included.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, loan servicing rights and fair values of financial instruments.
Cash and Cash Equivalents	Cash and Cash Equivalents The Company considers all liquid investments with original maturities of three months or less to be cash equivalents. Cash equivalents consist primarily of cash amounts due from depository institutions, interest‑bearing deposits in other banks, money market accounts, and federal funds sold. At December 31, 2018, the Company’s cash accounts exceeded federally insured limits by approximately $331.2 million. Included in this amount is approximately $295.4 million with the Federal Reserve Bank, $12.9 million with the Federal Home Loan Bank of Indianapolis, and $15,000 with the Federal Home Loan Bank of Chicago. At December 31, 2017, the Company’s cash accounts exceeded federally insured limits by approximately $349.4 million. Included in this amount is approximately $327.4 million with the Federal Reserve Bank and $3.5 million with the Federal Home Loan Bank of Indianapolis.
Securities purchased under agreements to resell	Securities purchased under agreements to resell Securities purchased pursuant to a simultaneous agreement (RRA) to resell the same securities at a specified price and date generally have maturity dates of 90 days or less and are carried at cost. Every 90 days the RRAs rollover.
Trading Activities	Trading Activities The Company engages in trading activities. Securities that are held principally for resale in the near term are recorded in the trading assets account at fair value with changes in fair value recorded in earnings. Trading securities include FHA and conventional participation certificates. Interest is included in net interest income.
Securities	Securities Certain debt securities that management has the positive intent and ability to hold to maturity are classified as “held to maturity” and recorded at amortized cost. Securities not classified as held to maturity or trading, including equity securities with readily determinable fair values, are classified as “available for sale” and recorded at fair value, with unrealized gains and losses excluded from earnings and reported in other comprehensive income. Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method. For debt securities with fair value below amortized cost when the Company does not intend to sell a debt security, and it is more likely than not the Company will not have to sell the security before recovery of its cost basis, it recognizes the credit component of an other‑than‑temporary impairment of a debt security in earnings and the remaining portion in other comprehensive income. For held‑to‑maturity debt securities, the amount of other‑than‑temporary impairment recorded in other comprehensive income for the noncredit portion of a previous other‑than‑temporary impairment is amortized prospectively over the remaining life of the security on the basis of the timing of future estimated cash flows of the security.
Loans Held for Sale under Mortgage Banking Activities	Loans Held for Sale under Mortgage Banking Activities The Company uses participation agreements to fund mortgage loans held for sale from closing or purchase until sale to an investor. Under a participation agreement the Company elects to purchase a participation interest of up to 100% in individual loans. The Company shares proportionately in the interest income and the credit risk until the loan is sold to an investor. The Company holds the collateral until it is sent under a bailee arrangement to the investor. Typical investors are large financial institutions or government agencies. These loans are carried at the lower of cost or fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance and included in noninterest income. Other mortgage loans originated and intended for sale in the secondary market, for which the fair value option has been elected, are carried at fair value at each balance sheet date. The Company believes that the fair value is the best indicator of the resolution of these loans. The difference between the cost and fair value was not material at December 31, 2018. For all loans held for sale, interest earned from the time of funding to the time of sale is accrued and recognized as interest income. Gains and losses on loan sales are recorded in noninterest income, and generally direct loan origination costs and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan. The gain on sale of loans in the income statement may include placement and origination fees, capitalized mortgage servicing rights, trading gains and losses and other related income .
Loans	Loans Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balances adjusted for unearned income, charge‑offs, the allowance for loan losses, any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans. For loans amortized at cost, interest income is accrued based on the unpaid principal balance. The accrual of interest on loans is discontinued at the time the loan is 90 days past due unless the credit is well‑secured and in process of collection. Past‑due status is based on contractual terms of the loan. In all cases, loans are placed on nonaccrual or charged off at an earlier date if collection of principal or interest is considered doubtful. For loans that are placed on nonaccrual or that are charged off, all accrued interest is reversed against interest income. The interest on these loans is applied to the principal balance until the loan can be returned to an accrual status. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. For all loan portfolio segments, the Company promptly charges off loans, or portions thereof, when available information confirms that specific loans are uncollectable based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower’s ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge‑off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral. When cash payments are received on impaired loans in each loan class, the Company records the payment as interest income unless collection of the remaining recorded principal amount is doubtful, at which time payments are used to reduce the principal balance of the loan. Troubled debt restructured loans recognize interest income on an accrual basis at the renegotiated rate if the loan is in compliance with the modified terms. The Company uses warehouse loans or credit to fund mortgage loans held for sale from closing until sale to an investor. Under a warehousing arrangement the Company funds a mortgage loan as secured financing. The warehousing arrangement is secured by the underlying mortgages and a combination of deposits, personal guarantees and advance rates. The Company holds the collateral until it is sent under a bailee arrangement instructing the investor to send proceeds to the Company. Typical investors are large financial institutions or government agencies. Interest earned from the time of funding to the time of sale is recognized as interest income as accrued. Fees earned agreements are recognized when collected as noninterest income.
Allowance for Loan Losses	Allowance for Loan Losses The allowance for loan losses is established as losses are estimated to have occurred through a provision for loan losses charged to income. Loan losses are charged against the allowance when management believes the uncollectability of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance for loan losses is evaluated on a regular basis by management and is based upon management’s periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower’s ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers non‑classified loans and is based on historical charge‑off experience and expected loss given default derived from the Company’s internal risk rating process. Other adjustments may be made to the allowance for pools of loans after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data. A loan is considered impaired when, based on current information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment status, collateral value and the probability of collecting scheduled principal and interest payments when due. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case‑by‑case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower’s prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is measured on a loan‑by‑loan basis for commercial and construction loans by either the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s obtainable market price or the fair value of the collateral if the loan is collateral dependent. For impaired loans where the Company utilizes discounted cash flows to determine the level of impairment, the Company includes the entire change in the present value of cash flows as bad debt expense. Groups of loans with similar risk characteristics are collectively evaluated for impairment based on the group’s historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans. Accordingly, the Company does not separately identify individual consumer and residential loans for impairment measurements, unless such loans are the subject of a restructuring agreement due to financial difficulties of the borrower. In the course of working with borrowers, the Company may choose to restructure the contractual terms of certain loans. In restructuring the loan, the Company attempts to work out an alternative payment schedule with the borrower in order to optimize collectability of the loan. A troubled debt restructuring (TDR) occurs when, for economic or legal reasons related to a borrower’s financial difficulties, the Company grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with its current financial status, and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms, or a combination of the two. Nonaccrual loans, including TDRs that have not met the six-month minimum performance criterion, are reported as nonperforming loans. For all loan classes, it is the Company’s policy to have any restructured loans which are on nonaccrual status prior to being restructured remain on nonaccrual status until six months of satisfactory borrower performance, at which time management would consider its return to accrual status. A loan is generally classified as nonaccrual when the Company believes that receipt of principal and interest is questionable under the terms of the loan agreement. Most generally, this is at 90 or more days past due. With regard to determination of the amount of the allowance for credit losses, restructured loans are considered to be impaired. As a result, the determination of the amount of impaired loans for each portfolio segment within troubled debt restructurings is the same as detailed previously above.
Premises and Equipment	Premises and Equipment Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight‑line method over the estimated useful lives of the assets. The estimated useful lives for premises and equipment are as follows: Buildings 10 to 40 years Leasehold improvements 5 to 39 years Furniture, fixtures and equipment 3 to 10 years Vehicles 5 years Expenditures for property and equipment and for renewals or betterments that extend the originally estimated economic life of the assets are capitalized. Expenditures for maintenance and repairs are charged to expense. When an asset is retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any gain or loss is included in the results of operations.
Federal Home Loan Bank Stock	Federal Home Loan Bank Stock Federal Home Loan Bank (FHLB) stock is a required investment for institutions that are members of a FHLB. The required investment in the common stock is based on a predetermined formula, carried at cost and evaluated for impairment.
Other Real Estate Owned	Other Real Estate Owned Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from other real estate.
Mortgage Servicing Rights	Mortgage Servicing Rights Mortgage servicing assets are recognized separately when rights are acquired through purchase or through sale of financial assets. Under the servicing assets and liabilities accounting guidance (ASC 860‑50), servicing rights resulting from the sale or securitization of loans originated by the Company are initially measured at fair value at the date of transfer. The Company has elected to initially and subsequently measure the mortgage servicing rights for mortgage loans using the fair value method. Under the fair value method, the servicing rights are carried in the balance sheet at fair value and the changes in fair value are reported in earnings in the period in which the changes occur. Fair value is based on market prices for comparable mortgage servicing contracts, when available, or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. The valuation model is from an independent third party and it incorporates assumptions that market participants would use in estimating future net servicing income, such as the cost to service, the discount rate, the custodial earnings rate, an inflation rate, ancillary income, prepayment speeds, prepayment penalties, and default rates and losses. These variables change from quarter to quarter as market conditions and projected interest rates change, and may have an adverse impact on the value of the mortgage‑servicing right and may result in a reduction to noninterest income. Servicing fee income is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal or a fixed amount per loan and are recorded as income when earned. The change in the fair value of the mortgage‑servicing rights is netted against loan servicing fee income.
Goodwill and Intangible Assets	Goodwill and Intangible Assets Goodwill is tested annually for impairment or more frequently if impairment indicators are present. If the implied fair value of goodwill is lower than its carrying amount, a goodwill impairment is indicated and goodwill is written down to its implied fair value. Subsequent increases in goodwill value are not recognized in the financial statements. Intangible assets, which include licenses and trade names, are amortized over a period ranging from 84 to 120 months using a straight line method of amortization. Also included are core deposit intangibles that are amortized over a 10 year period using the accelerated sum of the years digits method of amortization. On a periodic basis, the Company evaluates events and circumstances that may indicate a change in the recoverability of the carrying value.
Investment in Qualified Affordable Housing Limited Partnerships	Investment in Qualified Affordable Housing Limited Partnerships The Company has elected to account for its investment in affordable housing tax credit limited partnerships using the proportional amortization method described in FASB ASU 2014‑01, “Investments—Equity Method and Joint Ventures (Topic 323): Accounting for Investments in Qualified Affordable Housing Projects (A Consensus of the FASB Emerging Issues Task Force).” Under the proportional amortization method, an investor amortizes the initial cost of the investment to income tax expense in proportion to the tax credits and other tax benefits received and recognizes the net investment performance in the income statement as a component of income tax expense. The investment in the limited partnerships is included in other assets in the consolidated balance sheets.
Income Taxes	Income Taxes The Company accounts for income taxes in accordance with income tax accounting guidance (ASC 740, Income Taxes ). The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Company determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax bases of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur. Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized. Uncertain tax positions are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more‑likely‑than‑not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. The determination of whether or not a tax position has met the more‑likely‑than‑not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management’s judgment. With a few exceptions, the Company is no longer subject to U.S. federal, state and local or non‑U.S. income tax examinations by tax authorities for years before 2015. The Company recognizes interest and penalties, if any, on income taxes as a component of income tax expense. The Company files consolidated income tax returns with its subsidiaries.
Earnings Per Share	Earnings Per Share Basic earnings per share is the Company’s net income available to common shareholders, which represents net income less dividends paid or payable to preferred stock shareholders, if any, divided by the weighted‑average number of common shares outstanding during each period. Diluted earnings per share is calculated in the same manner as basic earnings per share, but also reflects the issuance of additional common shares that would have been diluted if such shares had been outstanding, as well as any adjustment to income that would result from the assumed issuance.
Share based Compensation Plan	Share‑based Compensation Plan The Company has a restricted stock plan that provides for annual awards of shares to certain members of senior management based upon the Company’s performance and attainment of certain performance goals established by the Board of Directors. Share awards are valued at the estimated fair value on the date of the award and generally vest over three years. Compensation expense for the awards is recognized in the consolidated financial statements ratably over the vesting period.
Comprehensive Income	Comprehensive Income Comprehensive income consists of net income and other comprehensive income (loss), net of applicable income taxes. Other comprehensive income (loss) and accumulated other comprehensive income consist entirely of unrealized appreciation (depreciation) on available‑for‑sale investment securities.
Reclassifications	Reclassifications Certain reclassifications have been made to the 2017 and 2016 financial statements to conform to the financial statement presentation as of and for the year ended December 31, 2018. These reclassifications had no effect on net income.

Nature of Operations and Summ_3

Nature of Operations and Summary of Significant Accounting Policies (Tables)	12 Months Ended
	Dec. 31, 2018
Nature of Operations and Summary of Significant Accounting Policies
Schedule of estimated useful lives	Buildings 10 to 40 years Leasehold improvements 5 to 39 years Furniture, fixtures and equipment 3 to 10 years Vehicles 5 years

Securities (Tables)

Securities (Tables)	12 Months Ended
	Dec. 31, 2018
Securities
Schedule of amortized cost and approximate fair values, together with gross unrealized gains and losses	December 31, 2018 Gross Gross Approximate Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Available-for-sale securities: Treasury notes $ 11,928 $ 26 $ 13 $ 11,941 Federal agencies 237,894 8 972 236,930 Municipals 21,014 336 18 21,332 Mortgage-backed - Government-sponsored entity (GSE) - residential 60,693 254 79 60,868 Total available-for-sale securities $ 331,529 $ 624 $ 1,082 $ 331,071 December 31, 2017 Gross Gross Approximate Amortized Unrealized Unrealized Fair Cost Gains Losses Value (In thousands) Available-for-sale securities: Treasury notes $ 1,000 $ — $ 8 $ 992 Federal agencies 376,414 — 1,683 374,731 Municipals 6,688 — — 6,688 Mortgage-backed - Government-sponsored entity (GSE) - residential 25,960 — — 25,960 Total available-for-sale securities $ 410,062 $ — $ 1,691 $ 408,371
Schedule of amortized cost and fair value of available-for-sale securities by contractual maturity	December 31, 2018 Amortized Fair Cost Value Contractual Maturity (In thousands) Within one year $ 179,323 $ 178,581 After one through five years 72,470 72,282 After five through ten years 7,087 7,203 After ten years 11,956 12,137 270,836 270,203 Mortgage-backed - Government-sponsored entity (GSE) - residential 60,693 60,868 $ 331,529 $ 331,071
Schedule of gross unrealized losses and fair value of investments with unrealized losses have been in continuous	December 31, 2018 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Available-for-sale securities: Treasury notes $ 1,990 $ 8 $ 995 $ 5 $ 2,985 $ 13 Federal agencies 28,296 97 191,280 875 219,576 972 Municipals 2,051 18 — — 2,051 18 Mortgage-backed - Government-sponsored entity (GSE) - residential 15,543 79 — — 15,543 79 $ 47,880 $ 202 $ 192,275 $ 880 $ 240,155 $ 1,082 December 31, 2017 12 Months or Less than 12 Months Longer Total Gross Gross Gross Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses (In thousands) Available-for-sale securities: Treasury notes $ 992 $ 8 $ — $ — $ 992 $ 8 Federal agencies 191,064 903 183,667 780 374,731 1,683 $ 192,056 $ 911 $ 183,667 $ 780 $ 375,723 $ 1,691

Loans and Allowance for Loan _2

Loans and Allowance for Loan Losses (Tables)	12 Months Ended
	Dec. 31, 2018
Loans and Allowance for Loan Losses
Summary of loans	December 31, December 31, 2018 2017 (In thousands) Mortgage warehouse lines of credit $ 337,332 $ 224,937 Residential real estate 410,871 330,410 Multi-family and healthcare financing 914,393 529,259 Commercial and commercial real estate 299,194 228,668 Agricultural production and real estate 79,255 51,966 Consumer and margin loans 17,082 9,420 2,058,127 1,374,660 Less Allowance for loan losses 12,704 8,311 Loans Receivable $ 2,045,423 $ 1,366,349
Summary of activity in the allowance for loans and recorded investment by loan portfolio	At or For the Year Ended December 31, 2018 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Allowance for loan losses Balance, beginning of period $ 283 $ 1,587 $ 3,502 $ 2,362 $ 320 $ 257 $ 8,311 Provision for loan losses 785 399 2,528 779 109 29 4,629 Loans charged to the allowance — — — (90) — (146) (236) Recoveries of loans previously charged off — — — — — — — Balance, end of period $ 1,068 $ 1,986 $ 6,030 $ 3,051 $ 429 $ 140 $ 12,704 Ending balance: individually evaluated for impairment $ 225 $ — $ — $ 400 $ 20 $ — $ 645 Ending balance: collectively evaluated for impairment $ 843 $ 1,986 $ 6,030 $ 2,651 $ 409 $ 140 $ 12,059 Loans Ending balance $ 337,332 $ 410,871 $ 914,393 $ 299,194 $ 79,255 $ 17,082 $ 2,058,127 Ending balance individually evaluated for impairment $ 575 $ 1,606 $ — $ 8,576 $ 370 $ 58 $ 11,185 Ending balance collectively evaluated for impairment $ 336,757 $ 409,265 $ 914,393 $ 290,618 $ 78,885 $ 17,024 $ 2,046,942 At or For the Year Ended December 31, 2017 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Allowance for loan losses Balance, beginning of period $ 373 $ 2,170 $ 1,962 $ 1,374 $ 269 $ 102 $ 6,250 Provision (credit) for loan losses (90) (583) 1,540 1,399 51 155 2,472 Loans charged to the allowance — — — (546) — — (546) Recoveries of loans previously charged off — — — 135 — — 135 Balance, end of period $ 283 $ 1,587 $ 3,502 $ 2,362 $ 320 $ 257 $ 8,311 Ending balance: individually evaluated for impairment $ — $ — $ — $ 200 $ 16 $ 146 $ 362 Ending balance: collectively evaluated for impairment $ 283 $ 1,587 $ 3,502 $ 2,162 $ 304 $ 111 $ 7,949 Loans Ending balance $ 224,937 $ 330,410 $ 529,259 $ 228,668 $ 51,966 $ 9,420 $ 1,374,660 Ending balance individually evaluated for impairment $ — $ 729 $ — $ 6,179 $ 282 $ 146 $ 7,336 Ending balance collectively evaluated for impairment $ 224,937 $ 329,681 $ 529,259 222,489 $ 51,684 $ 9,274 $ 1,367,324 For the Year Ended December 31, 2016 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Allowance for loan losses Balance, beginning of year $ 704 $ 2,212 $ 1,308 $ 908 $ 222 $ 68 $ 5,422 Provision for loan losses (331) 90 654 466 47 34 960 Transfer out — (132) — — — — (132) Loans charged to the allowance — — — — — — — Recoveries of loans previously charged off — — — — — — — Balance, end of year $ 373 $ 2,170 1,962 $ 1,374 $ 269 $ 102 $ 6,250
Schedule of credit risk profile of loan portfolio	December 31, 2018 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Special Mention (Watch) $ — $ 443 $ 71,734 $ 14,650 $ 3,096 $ 681 $ 90,604 Substandard 575 1,606 — 8,576 370 58 11,185 Doubtful — — — — — — — Acceptable and Above 336,757 408,822 842,659 275,968 75,789 16,343 1,956,338 Total $ 337,332 $ 410,871 $ 914,393 $ 299,194 $ 79,255 $ 17,082 $ 2,058,127 December 31, 2017 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Special Mention (Watch) $ — $ — $ 1,800 $ 12,608 $ 323 $ 1,563 $ 16,294 Substandard — 729 — 6,179 282 146 7,336 Doubtful — — — — — — — Acceptable and Above 224,937 329,681 527,459 209,881 51,361 7,711 1,351,030 Total $ 224,937 $ 330,410 $ 529,259 $ 228,668 $ 51,966 $ 9,420 $ 1,374,660
Schedule of aging analysis of the recorded investment in loans	December 31, 2018 30-59 Days 60-89 Days Greater Than Total Total Past Due Past Due 90 Days Past Due Current Loans (In thousands) MTG WHLOC $ — $ — $ 324 $ 324 $ 337,008 $ 337,332 RES RE 579 178 825 1,582 409,289 410,871 MF RE — — — — 914,393 914,393 CML & CRE 245 52 253 550 298,644 299,194 AG & AGRE 91 — 588 679 78,576 79,255 CON & MAR 2 52 28 82 17,000 17,082 $ 917 $ 282 $ 2,018 $ 3,217 $ 2,054,910 $ 2,058,127 December 31, 2017 30-59 Days 60-89 Days Greater Than Total Total Past Due Past Due 90 Days Past Due Current Loans (In thousands) MTG WHLOC $ — $ — $ — $ — $ 224,937 $ 224,937 RES RE — 194 534 728 329,682 330,410 MF RE — — — — 529,259 529,259 CML & CRE — 860 2,061 2,921 225,747 228,668 AG & AGRE 59 — 399 458 51,508 51,966 CON & MAR — — 146 146 9,274 9,420 $ 59 $ 1,054 $ 3,140 $ 4,253 $ 1,370,407 $ 1,374,660
Schedule of components of impaired loans and specific valuation allowance	December 31, 2018 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Impaired loans without a specific allowance: Recorded investment $ 251 $ 1,606 $ — $ 5,636 $ 88 $ 58 $ 7,639 Unpaid principal balance 251 1,606 — 5,636 88 58 7,639 Impaired loans with a specific allowance: Recorded investment 324 — — 2,940 282 — 3,546 Unpaid principal balance 324 — — 2,940 282 — 3,546 Specific allowance 225 — — 400 20 — 645 Total impaired loans: Recorded investment 575 1,606 — 8,576 370 58 11,185 Unpaid principal balance 575 1,606 — 8,576 370 58 11,185 Specific allowance 225 — — 400 20 — 645 December 31, 2017 MTG WHLOC RES RE MF RE CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Impaired loans without a specific allowance: Recorded investment $ — $ 729 $ — $ 4,119 $ — $ — $ 4,848 Unpaid principal balance — 729 — 4,119 — — 4,848 Impaired loans with a specific allowance: Recorded investment — — — 2,060 282 146 2,488 Unpaid principal balance — — — 2,060 282 146 2,488 Specific allowance — — — 200 16 146 362 Total impaired loans: Recorded investment — 729 — 6,179 282 146 7,336 Unpaid principal balance — 729 — 6,179 282 146 7,336 Specific allowance — — — 200 16 146 362
Schedule of average recorded investment and interest income recognized in impaired loans	December 31, 2018 MTG CML & AG & CON & WHLOC RES RE MF RE CRE AGRE MAR TOTAL (In thousands) Average recorded investment in impaired loans $ 932 $ 1,485 $ — $ 8,872 $ 489 $ 52 $ 11,830 Interest income recognized 59 50 — 375 43 1 528 December 31, 2017 MTG WHLOC RES RE MF CML & CRE AG & AGRE CON & MAR TOTAL (In thousands) Average recorded investment in impaired loans $ — $ 156 $ — $ 3,703 $ 282 $ 197 $ 4,338 Interest income recognized — 1 — 182 — — 183 December 31, 2016 MTG CML & AG & CON & WHLOC RES RE MF RE CRE AGRE MAR TOTAL (In thousands) Average recorded investment in impaired loans $ — $ 155 $ — $ 2,222 $ 17 $ — $ 2,394 Interest income recognized — — — 39 — — 39
Schedule of nonaccrual loans and loans past due 90 days or more and still accruing	December 31, December 31, 2018 2017 Total Loans > Total Loans > 90 Days & 90 Days & Nonaccrual Accruing Nonaccrual Accruing (In thousands) MTG WHLOC $ 575 $ — $ — $ — RES RE 893 74 60 475 MF RE — — — — CML & CRE 136 117 2,060 — AG & AGRE 282 307 282 117 CON & MAR 18 9 146 — $ 1,904 $ 507 $ 2,548 $ 592

Derivative Financial Instrume_2

Derivative Financial Instruments (Tables)	12 Months Ended
	Dec. 31, 2018
Derivative Financial Instruments
Summary of notional amount and fair value of interest rate locks and forward contracts utilized	Notional Fair Value Amount Balance Sheet Location Asset (Liability) December 31, 2018 (In thousands) (In thousands) Interest rate lock commitments $ 8,812 Derivative assets/liabilities $ 70 $ — Forward contracts 19,640 Derivative assets/liabilities — 9 $ 70 $ 9
Summarizes the periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income	Year Ended December 31, 2018 2017 (In thousands) Interest rate lock commitments $ 70 $ — Forward contracts (1) (64) — Net derivative gains (losses) 6 $ — _________________________________ (1) Amount includes pair-off settlements.

Loan Servicing (Tables)

Loan Servicing (Tables)	12 Months Ended
	Dec. 31, 2018
Loan Servicing
Schedule of mortgage servicing rights measured using fair value method	For the Year Ended December 31, 2018 2017 2016 (In thousands) Balance, beginning of period $ 66,079 $ 53,670 $ 55,553 Additions Originated and purchased servicing 14,113 10,993 5,745 Acquisition of MCS — 3,970 — Subtractions Paydowns (4,196) (5,504) (4,230) Changes in fair value due to changes in valuation inputs or assumptions used in the valuation model 1,848 2,950 (3,398) Balance, end of period $ 77,844 $ 66,079 $ 53,670

Goodwill and Intangibles (Table

Goodwill and Intangibles (Tables)	12 Months Ended
	Dec. 31, 2018
Goodwill and Intangibles
Schedule of goodwill	2018 2017 2016 Multifamily Banking Warehouse Total Multifamily Banking Warehouse Total Multifamily Banking Warehouse Total (In thousands) (In thousands) (In thousands) Balance, beginning of period $ 3,379 $ 523 $ — $ 3,902 $ — $ 523 $ — $ 523 $ — $ 523 $ — $ 523 Goodwill acquired during the period — 8,163 5,000 13,163 3,379 — — 3,379 — — — — Post-acquisition adjustment 412 — — 412 — — — — — — — — Impairment losses — — — — — — — — — — — — Balance, end of period $ 3,791 $ 8,686 $ 5,000 $ 17,477 $ 3,379 $ 523 $ — $ 3,902 $ — $ 523 $ — $ 523
Schedule of intangible assets	2018 2017 2016 Gross Gross Gross Carrying Accumulated Carrying Accumulated Carrying Accumulated Amount Amortization Total Amount Amortization Total Amount Amortization Total (In thousands) (In thousands) (In thousands) Licenses $ 1,370 $ (269) $ 1,101 $ 1,370 $ (74) $ 1,296 $ — $ — $ — Trade names 224 (31) 193 224 (8) 216 — — — Core deposit intangible 2,417 (169) 2,248 — — — — — — Total intangible Assets $ 4,011 $ (469) $ 3,542 $ 1,594 $ (82) $ 1,512 $ — $ — $ —
Estimated amortization expense	Year ending December 31, 2019 $ 639 2020 619 2021 577 2022 521 2023 462 Thereafter 724 Total $ 3,542

Premises and Equipment (Tables)

Premises and Equipment (Tables)	12 Months Ended
	Dec. 31, 2018
Premises and Equipment
Schedule of premises and equipment stated at cost	December 31, 2018 2017 (In thousands) Land $ 3,072 $ 2,260 Buildings 4,095 3,140 Building in progress 8,272 407 Leasehold improvements 83 71 Furniture, fixtures and equipment 2,427 2,131 Total cost 17,949 8,009 Accumulated depreciation (2,813) (2,655) Net premises and equipment $ 15,136 $ 5,354

Deposits (Tables)

Deposits (Tables)	12 Months Ended
	Dec. 31, 2018
Deposits
Schedule of deposits	December 31, 2018 2017 (In thousands) Demand deposits $ 1,548,969 $ 1,279,145 Savings deposits 1,001,663 1,255,460 Certificates of deposit 680,454 408,956 Total deposits $ 3,231,086 $ 2,943,561
Schedule of maturities of time deposits	December 31, 2018 (In thousands) Due within one year $ 648,173 Due in one year to two years 18,062 Due in two years to three years 9,727 Due in three years to four years 2,964 Due in four years to five years 1,528 $ 680,454
Schedule of brokered deposit amounts	December 31, 2018 2017 (In thousands) Brokered certificates of deposit $ 578,471 $ 347,000 Brokered savings deposits 109,607 389,475 Brokered deposit on demand accounts 300,134 205,039 $ 988,212 $ 941,514

Borrowings (Tables)

Borrowings (Tables)	12 Months Ended
	Dec. 31, 2018
Borrowings
Schedule of borrowings	December 31, 2018 2017 (In thousands) Lines of credit $ 33,150 $ 25,000 Short-term subordinated debt 10,582 30,000 FHLB advances 151,721 1,612 Total borrowings $ 195,453 $ 56,612
Schedule of maturities of FHLB advances	December 31, 2018 (In thousands) Due within one year $ 149,304 Due in one year to two years 590 Due in two years to three years 77 Due in three years to four years 59 Due in four years to five years 342 Thereafter 1,349 $ 151,721

Income Taxes (Tables)

Income Taxes (Tables)	12 Months Ended
	Dec. 31, 2018
Income Taxes
Schedule of provision for income taxes includes components	Year Ended December 31, 2018 2017 2016 (In thousands) Income tax expense Current tax payable Federal $ 13,312 $ 21,413 $ 18,627 State 5,528 3,479 4,477 Deferred tax payable Federal 1,583 (2,627) (441) State 730 212 (995) Income tax expense $ 21,153 $ 22,477 $ 21,668 Effective tax rate 25.2 % 29.1 % 39.5 %
Schedule of a reconciliation of statutory federal tax rate and effective tax rate	Year Ended December 31, 2018 2017 2016 (In thousands) Computed at the statutory rate (21% for 2018 and 35% for 2017 and 2016) $ 17,646 $ 27,006 $ 19,178 Increase resulting from State income taxes 4,944 2,399 2,264 Effect of Tax Cuts and Jobs Act — (6,928) — Low income housing tax credits (1,533) — — Other 96 — 226 Actual tax expense $ 21,153 $ 22,477 $ 21,668
Schedule of tax effects of temporary differences related to deferred taxes	December 31, 2018 2017 (In thousands) Deferred tax assets Allowance for loan losses $ 3,366 $ 2,216 Unrealized loss on available-for-sale securities 148 442 Other 854 1,548 Total assets 4,368 4,206 Deferred tax liabilities Depreciation (466) (147) Intangible assets (618) — Mortgage-servicing rights (17,477) (15,548) Limited partnership investments (2,212) (1,446) Fair value adjustments on acquisitions (3) — Total liabilities (20,776) (17,141) Net deferred tax liability $ (16,408) $ (12,935)

Regulatory Matters (Tables)

Regulatory Matters (Tables)	12 Months Ended
	Dec. 31, 2018
Regulatory Matters
Summary of bank's actual capital amounts and ratios	Minimum Amount Required for Minimum Amount Adequately To Be Well Actual Capitalized (1) Capitalized (1) Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) December 31, 2018 Total capital (1) (to risk-weighted assets) Company $ 393,654 12.3 % $ 255,884 8.0 % $ — N/A Merchants Bank 412,386 13.3 % 248,290 8.0 % 310,363 10.0 % FMBI 17,537 18.6 % 7,559 8.0 % 9,448 10.0 % Tier 1 capital (1) (to risk-weighted assets) Company 380,950 11.9 % 191,913 6.0 % — N/A Merchants Bank 399,815 12.9 % 186,218 6.0 % 248,290 8.0 % FMBI 17,404 18.4 % 5,669 6.0 % 7,559 8.0 % Common Equity Tier 1 capital (1) (to risk-weighted assets) Company 339,369 10.6 % 143,935 4.5 % — N/A Merchants Bank 399,815 12.9 % 139,663 4.5 % 201,736 6.5 % FMBI 17,404 18.4 % 4,252 4.5 % 6,141 6.5 % Tier 1 capital (1) (to average assets) Company 380,950 10.0 % 152,081 4.0 % — N/A Merchants Bank 399,815 11.0 % 145,723 4.0 % 182,154 5.0 % FMBI 17,404 10.8 % 6,453 4.0 % 8,066 5.0 % (1) As defined by regulatory agencies. Minimum Minimum Amount Required Amount To Be for Adequately Well Actual Capitalized (1) Capitalized (1) Amount Ratio Amount Ratio Amount Ratio (Dollars in thousands) December 31, 2017 Total capital (1) (to risk-weighted assets) Company $ 355,722 13.7 % $ 207,657 8.0 % $ — N/A Merchants Bank 406,638 15.7 % 207,567 8.0 % 259,459 10.0 % Tier I capital (1) (to risk-weighted assets) Company 347,411 13.4 % 155,743 6.0 % — N/A Merchants Bank 398,327 15.4 % 155,675 6.0 % 207,567 8.0 % Common Equity Tier I capital (1) (to risk-weighted assets) Company 305,830 11.8 % 116,807 4.5 % — N/A Merchants Bank 398,327 15.4 % 116,756 4.5 % 168,648 6.5 % Tier I capital (1) (to average assets) Company 347,411 10.9 % 127,318 4.0 % — N/A Merchants Bank 398,327 12.5 % 127,593 4.0 % 159,491 5.0 % (1) As defined by regulatory agencies. Beginning January 1, 2015, the Basel III Capital Rules applied to Merchants Bank. The following table lists the capital categories and ratios determined by the Board of Governors of the Federal Reserve System and the Federal Deposit Insurance Corporation. Common Equity Total Risk-based Tier 1 Risk-based Tier 1 Risk-based Tier 1 Capital Category Capital ratio Capital ratio Capital ratio Leverage ratio Well capitalized 10 % 8 % 6.5 % 5 % Adequately capitalized 8 6 4.5 4 Undercapitalized <8 <6 <4.5 <4 Significantly undercapitalized <6 <4 <3 <3 Critically undercapitalized Tangible Equity/Total Assets </= 2%

Earnings Per Share (Tables)

Earnings Per Share (Tables)	12 Months Ended
	Dec. 31, 2018
Earnings Per share
Schedule of computation of earnings per share	Year Ended December 31, 2018 2017 2016 Weighted- Per Weighted- Per Weighted- Per Net Average Share Net Average Share Net Average Share Income Shares Amount Income Shares Amount Income Shares Amount (In thousands) (In thousands) (In thousands) Net income $ 62,874 $ 54,684 $ 33,127 Dividends on preferred stock (3,330) (3,330) (2,002) Net income allocated to common shareholders $ 59,544 $ 51,354 $ 31,125 Basic earnings per share 28,692,955 $ 2.08 22,551,452 $ 2.28 21,111,208 $ 1.47 Effect of dilutive securities—restricted stock awards 31,464 16,702 2,227 Diluted earnings per share 28,724,419 $ 2.07 22,568,154 $ 2.28 21,113,435 $ 1.47

Disclosures about Fair Value _2

Disclosures about Fair Value of Assets and Liabilities (Tables)	12 Months Ended
	Dec. 31, 2018
Disclosures about Fair Value of Assets and Liabilities
Schedule of fair value measurement of assets measured at fair value on recurring basis	Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Fair Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) December 31, 2018 Trading securities $ 163,419 $ — $ 163,419 $ — Available-for-sale securities: Treasury notes 11,941 11,941 — — Federal agencies 236,930 — 236,930 — Municipals 21,332 — 21,332 — Mortgage-backed - Government-sponsored entity (GSE) - residential 60,868 — 60,868 — Loans held for sale 11,886 — 11,886 — Mortgage servicing rights 77,844 — — 77,844 Derivative assets - interest rate lock commitments 70 — — 70 Derivative liabilities - forward contracts 9 — 9 — December 31, 2017 Trading securities $ 140,837 $ — $ 140,837 $ — Available-for-sale securities: Treasury notes 992 992 — — Federal agencies 374,731 — 374,731 — Municipals 6,688 — — 6,688 Mortgage-backed - Government-sponsored entity (GSE) - residential 25,960 — 25,960 — Mortgage servicing rights 66,079 — — 66,079
Schedule of Level 3 reconciliation of recurring fair value measurements	Year Ended December 31, 2018 2017 2016 (In thousands) Mortgage servicing rights Balance, beginning of period $ 66,079 $ 53,670 $ 55,553 Additions Originated and purchased servicing 14,113 10,993 5,745 Acquisition of MCS — 3,970 — Subtractions Paydowns (4,196) (5,504) (4,230) Changes in fair value due to changes in valuation inputs or assumptions used in the valuation model 1,848 2,950 (3,398) Balance, end of period $ 77,844 $ 66,079 $ 53,670 Available-for-sale securities - Municipals Balance, beginning of period $ 6,688 $ — $ — Additions Purchased securities — 6,688 — Subtractions Paydowns (257) — — Sales (6,431) — — Unrealized gains (losses) included in other comprehensive income — — — Balance, end of period $ — $ 6,688 $ — Derivative Assets - interest rate lock commitments Balance, beginning of period $ — $ — $ — Purchases — — Changes in fair value 70 — Balance, end of period $ 70 $ — $ —
Schedule of fair value measurement of assets and liabilities measured at fair value on nonrecurring basis	Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Fair Assets Inputs Inputs Assets Value (Level 1) (Level 2) (Level 3) (In thousands) December 31, 2018 Impaired loans (collateral-dependent) $ 2,639 $ — $ — $ 2,639 December 31, 2017 Impaired loans (collateral-dependent) $ 2,126 $ — $ — $ 2,126
Schedule of quantitative information about unobservable inputs used in recurring and nonrecurring Level 3 fair value measurements other than goodwill	Valuation Fair Value Technique Unobservable Inputs Range (In thousands) At December 31, 2018: Collateral-dependent impaired loans $ 2,639 Market comparable properties Marketability discount 17%-59% Mortgage servicing rights $ 77,844 Discounted cash flow Discount rate 8% - 13% Constant prepayment rate 1% - 30% Derivative assets - interest rate lock commitments $ 70 Discounted cash flow loan closing rates 95-100% At December 31, 2017: Collateral-dependent impaired loans $ 2,126 Market comparable properties Marketability discount 5% - 47% Mortgage servicing rights $ 66,079 Discounted cash flow Discount rate 8% - 13% Constant prepayment rate 1% - 36%
Schedule of carrying amount and estimated fair value of financial instruments	Fair Value Measurements Using Quoted Prices in Significant Active Markets Other Significant for Identical Observable Unobservable Carrying Fair Assets Inputs Inputs Assets Value Value (Level 1) (Level 2) (Level 3) (In thousands) December 31, 2018 Financial assets: Cash and cash equivalents $ 336,524 $ 336,524 $ 336,524 $ — $ — Securities purchased under agreements to resell 6,875 6,875 — 6,875 — FHLB stock 7,974 7,974 — 7,974 — Loans held for sale 820,569 820,569 — 820,569 — Loans, net 2,045,423 2,041,772 — — 2,041,772 Interest receivable 13,827 13,827 — 13,827 — Financial liabilities: Deposits 3,231,086 3,230,397 2,550,632 679,765 — Lines of credit 33,150 33,150 — 33,150 — Short-term subordinated debt 10,582 10,582 — 10,582 — FHLB advances 151,721 151,723 — 151,723 — Interest payable 4,132 4,132 — 4,132 — December 31, 2017 Financial assets: Cash and cash equivalents $ 359,519 $ 359,519 $ 359,519 $ — $ — Securities purchased under agreements to resell 7,043 7,043 — 7,043 — FHLB stock 7,539 7,539 — 7,539 — Loans held for sale 995,319 995,319 — 995,319 — Loans, net 1,366,349 1,364,568 — — 1,364,568 Interest receivable 8,326 8,326 — 8,326 — Financial liabilities: Deposits 2,943,561 2,943,173 2,534,605 408,568 — Line of credit 25,000 25,000 — 25,000 — Short-term subordinated debt 30,000 30,000 — 30,000 — FHLB advances 1,612 1,620 — 1,620 — Interest payable 2,817 2,817 — 2,817 —

Commitments and Credit Risk (Ta

Commitments and Credit Risk (Tables)	12 Months Ended
	Dec. 31, 2018
Commitments and Credit Risk
Schedule of business segment financial information	December 31, 2018 2017 (In thousands) Commitments to extend credit $ 676,987 $ 437,585 Irrevocable standby letters of credit 3,164 26,000 Commitment letters of credit 19,866 31,031
Schedule of future minimum lease payments under operating leases	December 31, 2018 (In thousands) Due within one year $ 1,021 Due in one year to two years 1,085 Due in two years to three years 736 Due in three years to four years 550 Due in four years to five years 554 Thereafter 426 Total minimum lease payments $ 4,372

Segment Information (Tables)

Segment Information (Tables)	12 Months Ended
	Dec. 31, 2018
Segment Information
Schedule of business segment financial information	Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Year Ended December 31, 2018 Total interest income $ 712 $ 58,784 $ 79,332 $ 1,735 $ 140,563 Total interest expense — 24,369 29,508 (3,285) 50,592 Net interest income 712 34,415 49,824 5,020 89,971 Provision for loan losses — 1,372 3,257 — 4,629 Net interest income after provision for loan losses 712 33,043 46,567 5,020 85,342 Total noninterest income 45,831 2,550 3,150 (1,946) 49,585 Noninterest expense 19,205 7,721 14,876 9,098 50,900 Income before income taxes 27,338 27,872 34,841 (6,024) 84,027 Income taxes 7,528 6,872 8,572 (1,819) 21,153 Net income $ 19,810 $ 21,000 $ 26,269 $ (4,205) $ 62,874 Total assets $ 166,102 $ 1,430,776 $ 2,256,687 $ 30,598 $ 3,884,163 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Year Ended December 31, 2017 Total interest income $ 414 $ 48,798 $ 44,454 $ 721 $ 94,387 Total interest expense — 13,673 14,853 (736) 27,790 Net interest income 414 35,125 29,601 1,457 66,597 Provision for loan losses — 452 2,020 — 2,472 Net interest income after provision for loan losses 414 34,673 27,581 1,457 64,125 Total noninterest income 43,715 2,836 1,943 (814) 47,680 Noninterest expense 10,911 7,710 9,835 6,188 34,644 Income before income taxes 33,218 29,799 19,689 (5,545) 77,161 Income taxes 4,557 11,558 8,279 (1,917) 22,477 Net income $ 28,661 $ 18,241 $ 11,410 $ (3,628) $ 54,684 Total assets $ 134,390 $ 1,352,748 $ 1,889,140 $ 16,855 $ 3,393,133 Multi-family Mortgage Mortgage Banking Warehousing Banking Other Total (In thousands) Year Ended December 31, 2016 Total interest income $ 237 $ 43,352 $ 29,350 $ — $ 72,939 Total interest expense — 11,235 6,546 1,187 18,968 Net interest income 237 32,117 22,804 (1,187) 53,971 Provision for loan losses — (247) 1,207 — 960 Net interest income after provision for loan losses 237 32,364 21,597 (1,187) 53,011 Total noninterest income 22,798 3,220 2,486 — 28,504 Noninterest expense 7,474 7,730 8,383 3,133 26,720 Income before income taxes 15,561 27,854 15,700 (4,320) 54,795 Income taxes 6,153 11,015 6,208 (1,708) 21,668 Net income $ 9,408 $ 16,839 $ 9,492 $ (2,612) $ 33,127 Total assets $ 98,553 $ 1,060,723 $ 1,545,783 $ 13,453 $ 2,718,512

Condensed Financial Informati_2

Condensed Financial Information (Parent Company Only) (Tables)	12 Months Ended
	Dec. 31, 2018
Condensed Financial Information (Parent Company Only)
Summary of Condensed Balance Sheets	December 31, 2018 2017 (In thousands) Assets Cash and cash equivalents $ 2,224 $ 7,273 Investment in subsidiaries 453,028 411,528 Other assets 2,104 5,597 Total assets $ 457,356 $ 424,398 Liabilities Lines of credit $ 25,000 $ 25,000 Short-term subordinated debt 10,582 30,000 Other liabilities 537 1,924 Total liabilities 36,119 56,924 Shareholders’ Equity 421,237 367,474 Total liabilities and shareholders’ equity $ 457,356 $ 424,398
Summary of Condensed Statements of Income and Comprehensive Income	Year Ended December 31, 2018 2017 2016 (In thousands) Income Dividends and return of capital from subsidiaries 37,816 13,632 16,223 Other Income 195 208 196 Total income 38,011 13,840 16,419 Expenses Interest expense 8,055 7,603 7,237 Salaries and employee benefits 1,216 1,617 77 Professional fees 707 341 138 Other 420 251 33 Total expense 10,398 9,812 7,485 Income Before Income Tax and Equity in Undistributed Income of Subsidiaries 27,613 4,028 8,934 Income Tax Benefit (2,542) (3,670) (2,885) Income Before Equity in Undistributed Income of Subsidiaries 30,155 7,698 11,819 Equity in Undistributed Income of Subsidiaries 32,719 46,986 21,308 Net Income $ 62,874 $ 54,684 $ 33,127 Comprehensive Income $ 63,813 $ 54,306 $ 32,731
Summary of Condensed Statements of Cash Flows	Year Ended December 31, 2018 2017 2016 (In thousands) Operating Activities Net income $ 62,874 $ 54,684 $ 33,127 Adjustments to reconcile net income to net cash used in operating activities (30,522) (44,185) (26,561) Net cash provided by operating activities 32,352 10,499 6,566 Investing Activities Return of capital from/(contributed capital to) subsidiaries 19,368 (101,868) (31,625) Net cash paid for acquisitions (27,209) — — Other investing activity 74 189 (295) Net cash used in investing activities (7,767) (101,679) (31,920) Financing Activities Net change in short-term subordinated debt (19,418) — — Dividends paid (10,216) (7,950) (6,224) Proceeds from issuance of common stock — 106,245 — Proceeds from issuance of preferred stock — — 31,581 Net cash provided by (used in) financing activities (29,634) 98,295 25,357 Net Change in Cash and Due From Banks (5,049) 7,115 3 Cash and Due From Banks at Beginning of Year 7,273 158 155 Cash and Due From Banks at End of Year $ 2,224 $ 7,273 158

Quarterly Condensed Financial_2

Quarterly Condensed Financial Information (Unaudited) (Tables)	12 Months Ended
	Dec. 31, 2018
Quarterly Condensed Financial Information (Unaudited)
Schedule of quarterly condensed financial information (unaudited)	2018 Quarter Ended (Dollars in thousands, except per share data) March 31 June 30 September 30 December 31 Interest income $ 29,038 $ 34,123 $ 37,577 $ 39,825 Interest expense 8,930 11,917 14,095 15,650 Net interest income 20,108 22,206 23,482 24,175 Provision for loan losses 1,406 998 617 1,608 Net interest income after provision for loan losses 18,702 21,208 22,865 22,567 Noninterest income 11,313 11,630 11,907 14,735 Noninterest expense 10,270 12,000 12,449 16,181 Income before income taxes 19,745 20,838 22,323 21,121 Income taxes 4,684 5,186 5,584 5,699 Net income 15,061 15,652 16,739 15,422 Less: preferred stock dividends 833 832 833 832 Net income allocated to common shareholders $ 14,228 $ 14,820 $ 15,906 $ 14,590 Per common share data: Basic earnings per common share $ 0.50 $ 0.52 $ 0.55 $ 0.51 Diluted earnings per common share 0.50 0.52 0.55 0.51 2017 Quarter Ended (Dollars in thousands, except per share data) March 31 June 30 September 30 December 31 Interest income $ 19,007 $ 22,464 $ 26,006 $ 26,910 Interest expense 5,476 6,740 7,616 7,958 Net interest income 13,531 15,724 18,390 18,952 Provision for loan losses 240 240 592 1,400 Net interest income after provision for loan losses 13,291 15,484 17,798 17,552 Noninterest income 8,091 16,626 8,056 14,907 Noninterest expense 6,641 8,261 8,942 10,800 Income before income taxes 14,741 23,849 16,912 21,659 Income taxes 5,611 9,091 6,445 1,330 Net income 9,130 14,758 10,467 20,329 Less: preferred stock dividends 832 832 833 833 Net income allocated to common shareholders $ 8,298 $ 13,926 $ 9,634 $ 19,496 Per common share data: Basic earnings per common share $ 0.39 $ 0.66 $ 0.45 $ 0.73 Diluted earnings per common share 0.39 0.66 0.45 0.73

Nature of Operations and Summ_4

Nature of Operations and Summary of Significant Accounting Policies - Operations (Details)	12 Months Ended
	Dec. 31, 2018item
Merchants Bank
Nature of Operations and Principles of Consolidation
Number of locations of operation	4
FMBI
Nature of Operations and Principles of Consolidation
Number of locations of operation	5

Nature of Operations and Summ_5

Nature of Operations and Summary of Significant Accounting Policies - Recent Acquisitions (Details) - USD ($)	Dec. 31, 2018	Oct. 01, 2018	Jan. 02, 2018	Aug. 15, 2017	Dec. 31, 2018	Sep. 30, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Acquisitions
Goodwill	$ 17,477,000				$ 17,477,000		$ 3,902,000	$ 523,000	$ 523,000
Total assets	3,884,163,000				3,884,163,000		3,393,133,000	$ 2,718,512,000
Fair Value of available for sale securities	331,071,000				331,071,000		408,371,000
Time deposits at fair value	680,454,000				680,454,000		408,956,000
Deposits	3,231,086,000				3,231,086,000		2,943,561,000
Loans Receivable, Net	2,045,423,000				$ 2,045,423,000		1,366,349,000
Core Deposits
Acquisitions
Useful life					10 years
MCS
Acquisitions
Percentage of voting interests acquired				100.00%
Purchase price paid shares				$ 8,100,000
Goodwill				3,800,000
Intangible assets				$ 1,600,000
FMBI
Acquisitions
Total assets							43,000,000
Deposits							36,900,000
FMBI | Stock Purchase Agreement
Acquisitions
Total cost			$ 5,500,000
Goodwill			988,000
Intangible assets			478,000
Time deposits			16,700,000
Time deposits at fair value			16,900,000
Fair value premium of acquired time deposits			$ 185,000
Time deposits, fair value premium, accretion period			20 months
Acquired loan portfolio			$ 27,900,000
Acquired loan portfolio at fair value			27,500,000
Fair value discount on acquired loan portfolio			$ 458,000
Acquired loan portfolio, fair value discount, accretion period			39 months
FMBI | Core Deposits
Acquisitions
Useful life					10 years
FMBI | Core Deposits | Stock Purchase Agreement
Acquisitions
Useful life			10 years
FM Bancorp, Inc
Acquisitions
Outstanding shares of the acquiree		27,537
Share price per share		$ 795.29
Total cost		$ 21,900,000
Goodwill		7,200,000
Intangible assets		1,900,000
Fair Value of available for sale securities		66,300,000
Fair value discount on available for sale securities		1,000,000
Time deposits		95,700,000
Time deposits at fair value		95,700,000
Acquired loan portfolio		35,400,000
Acquired loan portfolio at fair value		34,800,000
Fair value discount on acquired loan portfolio		625,000
Discount related to interest assumption		279,000
Discount related to credit assumption		$ 346,000
Acquired loan portfolio, fair value discount, accretion period		72 months
FM Bancorp, Inc | Core Deposits
Acquisitions
Useful life		10 years
NattyMac, LLC
Acquisitions
Goodwill	5,000,000				$ 5,000,000
Repayments of subordinated debt	$ 30,000,000
FMBI
Acquisitions
Total assets							$ 43,000,000
FM Bancorp
Acquisitions
Total assets						$ 110,000,000
Fair Value of available for sale securities						66,300,000
Deposits						95,700,000
Loans Receivable, Net						$ 35,000,000

Nature of Operations and Summ_6

Nature of Operations and Summary of Significant Accounting Policies - Other (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Cash and Cash Equivalents
Cash accounts in excess of federally insured limits	$ 331,200,000	$ 349,400,000
Cash accounts in excess of federally insured limits with Federal Reserve Bank	295,400,000	327,400,000
Cash accounts in excess of federally insured limits with Federal Home Loan Bank of Indianapolis	12,900,000	$ 3,500,000
Cash accounts in excess of federally insured limits with Federal Home Loan Bank of Chicago	$ 15,000
Loans Held for Sale under Mortgage Banking Activities
Maximum participation interest to be purchased in individual loans (as a percent)	100.00%

Nature of Operations and Summ_7

Nature of Operations and Summary of Significant Accounting Policies - Premises and Equipment (Details)	12 Months Ended
	Dec. 31, 2018
Vehicles
Premises and Equipment
Estimated useful lives	P5Y
Minimum | Buildings
Premises and Equipment
Estimated useful lives	P10Y
Minimum | Leasehold improvements
Premises and Equipment
Estimated useful lives	P5Y
Minimum | Furniture, fixtures and equipment
Premises and Equipment
Estimated useful lives	P3Y
Maximum | Buildings
Premises and Equipment
Estimated useful lives	P40Y
Maximum | Leasehold improvements
Premises and Equipment
Estimated useful lives	P39Y
Maximum | Furniture, fixtures and equipment
Premises and Equipment
Estimated useful lives	P10Y

Nature of Operations and Summ_8

Nature of Operations and Summary of Significant Accounting Policies - Goodwill and Intangible Assets (Details)	12 Months Ended
	Dec. 31, 2018
Core Deposits
Intangible assets
Amortization period	10 years
Minimum
Intangible assets
Amortization period	84 months
Maximum
Intangible assets
Amortization period	120 months

Nature of Operations and Summ_9

Nature of Operations and Summary of Significant Accounting Policies - Shared-based Compensation (Details)	12 Months Ended
	Dec. 31, 2018
Share-based Compensation Plan
Share awards vesting period	3 years

Restriction on Cash and Due F_2

Restriction on Cash and Due From Banks (Details) - USD ($) $ in Millions	Dec. 31, 2018	Dec. 31, 2017
Restriction on Cash and Due From Banks
Reserve required for restriction on cash and due from banks	$ 114.2	$ 104.2

Securities - Trading Securities

Securities - Trading Securities (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Trading Securities
Unrealized gains included in trading securities	$ 870,000	$ 643,000

Securities - Amortized Cost to

Securities - Amortized Cost to Approximate Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Available-for-sale securities:
Amortized Cost	$ 331,529	$ 410,062
Gross Unrealized Gains	624
Gross Unrealized Losses	1,082	1,691
Fair Value of available for sale securities	331,071	408,371
Treasury notes
Available-for-sale securities:
Amortized Cost	11,928	1,000
Gross Unrealized Gains	26
Gross Unrealized Losses	13	8
Fair Value of available for sale securities	11,941	992
Federal agencies
Available-for-sale securities:
Amortized Cost	237,894	376,414
Gross Unrealized Gains	8
Gross Unrealized Losses	972	1,683
Fair Value of available for sale securities	236,930	374,731
Municipals
Available-for-sale securities:
Amortized Cost	21,014	6,688
Gross Unrealized Gains	336
Gross Unrealized Losses	18
Fair Value of available for sale securities	21,332	6,688
Mortgage-backed - Government-sponsored entity (GSE) - residential
Available-for-sale securities:
Amortized Cost	60,693	25,960
Gross Unrealized Gains	254
Gross Unrealized Losses	79
Fair Value of available for sale securities	$ 60,868	$ 25,960

Securities - Contractual Maturi

Securities - Contractual Maturities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Contractual Maturities, Amortized Cost
Within one year	$ 179,323
After one through five years	72,470
After five through ten years	7,087
After ten years	11,956
Contractual Maturities, Amortized Cost, Single Maturity Date	270,836
Available-for-sale Securities, Amortized Cost Basis, Total	331,529	$ 410,062
Contractual Maturities, Fair Value
Within one year	178,581
After one through five years	72,282
After five through ten years	7,203
After ten years	12,137
Contractual Maturities, Fair Value, Single Maturity Date	270,203
Fair Value of available for sale securities	331,071	408,371
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	$ 240,155	$ 375,723
Percentage of investment portfolio	73.00%	92.00%
Investment securities pledged as collateral	$ 281,200	$ 401,700
Mortgage-backed - Government-sponsored entity (GSE) - residential
Contractual Maturities, Amortized Cost
Contractual Maturities, Amortized Cost, Not Due at a Single Maturity Date	60,693
Available-for-sale Securities, Amortized Cost Basis, Total	60,693	25,960
Contractual Maturities, Fair Value
Contractual Maturities, Fair Value, Not Due at a Single Maturity Date	60,868
Fair Value of available for sale securities	60,868	$ 25,960
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value	$ 15,543

Securities - Continuous Unreali

Securities - Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months	$ 47,880	$ 192,056
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer	192,275	183,667
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total	240,155	375,723
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months	202	911
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer	880	780
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total	1,082	1,691
Treasury notes
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months	1,990	992
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer	995
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total	2,985	992
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months	8	8
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer	5
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total	13	8
Federal agencies
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months	28,296	191,064
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, 12 Months or Longer	191,280	183,667
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total	219,576	374,731
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months	97	903
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, 12 Months or Longer	875	780
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total	972	$ 1,683
Municipals
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months	2,051
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total	2,051
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months	18
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total	18
Mortgage-backed - Government-sponsored entity (GSE) - residential
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value
Available-for-sale securities, Continuous Unrealized Loss Position, Fair Value, Less than 12 Months	15,543
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total	15,543
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Less than 12 Months	79
Available-for-sale securities, Continuous Unrealized Loss Position, Gross Unrealized Losses, Total	$ 79

Securities - Other (Details)

Securities - Other (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Securities
Proceeds from the sale of securities available for sale	$ 6,431	$ 0	$ 7,371
Gain on sale of securities			24
Realized gross gains on available for sale securities			$ 24
Investment securities pledged as collateral	$ 281,200	$ 401,700

Loans and Allowance for Loan _3

Loans and Allowance for Loan Losses - Summary of Loans By Classification (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Loans and Allowance for Loan Losses
Loans	$ 2,058,127	$ 1,374,660
Allowance for loan losses	12,704	8,311	$ 6,250	$ 5,422
Loans and Leases Receivable, Net Amount, Total	$ 2,045,423	1,366,349
Minimum
Loans and Allowance for Loan Losses
Repayment Of Warehouse Term	30 days
Mortgage warehouse lines of credit
Loans and Allowance for Loan Losses
Loans	$ 337,332	224,937
Allowance for loan losses	1,068	283	373	704
Residential real estate
Loans and Allowance for Loan Losses
Loans	410,871	330,410
Allowance for loan losses	1,986	1,587	2,170	2,212
Multi-family and healthcare financing
Loans and Allowance for Loan Losses
Loans	914,393	529,259
Allowance for loan losses	6,030	3,502	1,962	1,308
Commercial and commercial real estate
Loans and Allowance for Loan Losses
Loans	299,194	228,668
Allowance for loan losses	3,051	2,362	1,374	908
Agricultural production and real estate
Loans and Allowance for Loan Losses
Loans	79,255	51,966
Allowance for loan losses	429	320	269	222
Consumer and margin loans
Loans and Allowance for Loan Losses
Loans	17,082	9,420
Allowance for loan losses	$ 140	$ 257	$ 102	$ 68

Loans and Allowance for Loan _4

Loans and Allowance for Loan Losses - Allowance For Loan Losses (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Allowance for loan losses
Balance, beginning of period	$ 8,311	$ 6,250	$ 5,422
Provision (credit) for loan losses	(4,629)	(2,472)	(960)
Transfer out			(132)
Loans charged to the allowance	(236)	(546)
Recoveries of loans previously charged off		(135)
Balance, end of period	12,704	8,311	6,250
Ending balance: individually evaluated for impairment	645	362
Ending balance: collectively evaluated for impairment	12,059	7,949
Loans
Ending balance	2,058,127	1,374,660
Ending balance individually evaluated for impairment	11,185	7,336
Ending balance: collectively evaluated for impairment	2,046,942	1,367,324
Mortgage warehouse lines of credit
Allowance for loan losses
Balance, beginning of period	283	373	704
Provision (credit) for loan losses	(785)	90	331
Balance, end of period	1,068	283	373
Ending balance: individually evaluated for impairment	225
Ending balance: collectively evaluated for impairment	843	283
Loans
Ending balance	337,332	224,937
Ending balance individually evaluated for impairment	575
Ending balance: collectively evaluated for impairment	336,757	224,937
Residential real estate
Allowance for loan losses
Balance, beginning of period	1,587	2,170	2,212
Provision (credit) for loan losses	(399)	583	(90)
Transfer out			(132)
Balance, end of period	1,986	1,587	2,170
Ending balance: collectively evaluated for impairment	1,986	1,587
Loans
Ending balance	410,871	330,410
Ending balance individually evaluated for impairment	1,606	729
Ending balance: collectively evaluated for impairment	409,265	329,681
Multi-family and healthcare financing
Allowance for loan losses
Balance, beginning of period	3,502	1,962	1,308
Provision (credit) for loan losses	(2,528)	(1,540)	(654)
Balance, end of period	6,030	3,502	1,962
Ending balance: collectively evaluated for impairment	6,030	3,502
Loans
Ending balance	914,393	529,259
Ending balance: collectively evaluated for impairment	914,393	529,259
Commercial and commercial real estate
Allowance for loan losses
Balance, beginning of period	2,362	1,374	908
Provision (credit) for loan losses	(779)	(1,399)	(466)
Loans charged to the allowance	(90)	(546)
Recoveries of loans previously charged off		(135)
Balance, end of period	3,051	2,362	1,374
Ending balance: individually evaluated for impairment	400	200
Ending balance: collectively evaluated for impairment	2,651	2,162
Loans
Ending balance	299,194	228,668
Ending balance individually evaluated for impairment	8,576	6,179
Ending balance: collectively evaluated for impairment	290,618	222,489
Agricultural production and real estate
Allowance for loan losses
Balance, beginning of period	320	269	222
Provision (credit) for loan losses	(109)	(51)	(47)
Balance, end of period	429	320	269
Ending balance: individually evaluated for impairment	20	16
Ending balance: collectively evaluated for impairment	409	304
Loans
Ending balance	79,255	51,966
Ending balance individually evaluated for impairment	370	282
Ending balance: collectively evaluated for impairment	78,885	51,684
Consumer and margin loans
Allowance for loan losses
Balance, beginning of period	257	102	68
Provision (credit) for loan losses	(29)	(155)	(34)
Loans charged to the allowance	(146)
Balance, end of period	140	257	$ 102
Ending balance: individually evaluated for impairment		146
Ending balance: collectively evaluated for impairment	140	111
Loans
Ending balance	17,082	9,420
Ending balance individually evaluated for impairment	58	146
Ending balance: collectively evaluated for impairment	$ 17,024	$ 9,274

Loans and Allowance for Loan _5

Loans and Allowance for Loan Losses - Credit Risk Profile of Loan Portfolio (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Credit risk profile of portfolio
Loans	$ 2,058,127	$ 1,374,660
Special Mention (Watch)
Credit risk profile of portfolio
Loans	90,604	16,294
Substandard
Credit risk profile of portfolio
Loans	11,185	7,336
Acceptable and Above
Credit risk profile of portfolio
Loans	1,956,338	1,351,030
Mortgage warehouse lines of credit
Credit risk profile of portfolio
Loans	337,332	224,937
Mortgage warehouse lines of credit | Substandard
Credit risk profile of portfolio
Loans	575
Mortgage warehouse lines of credit | Acceptable and Above
Credit risk profile of portfolio
Loans	336,757	224,937
Residential real estate
Credit risk profile of portfolio
Loans	410,871	330,410
Residential real estate | Special Mention (Watch)
Credit risk profile of portfolio
Loans	443
Residential real estate | Substandard
Credit risk profile of portfolio
Loans	1,606	729
Residential real estate | Acceptable and Above
Credit risk profile of portfolio
Loans	408,822	329,681
Multi-family and healthcare financing
Credit risk profile of portfolio
Loans	914,393	529,259
Multi-family and healthcare financing | Special Mention (Watch)
Credit risk profile of portfolio
Loans	71,734	1,800
Multi-family and healthcare financing | Acceptable and Above
Credit risk profile of portfolio
Loans	842,659	527,459
Commercial and commercial real estate
Credit risk profile of portfolio
Loans	299,194	228,668
Commercial and commercial real estate | Special Mention (Watch)
Credit risk profile of portfolio
Loans	14,650	12,608
Commercial and commercial real estate | Substandard
Credit risk profile of portfolio
Loans	8,576	6,179
Commercial and commercial real estate | Acceptable and Above
Credit risk profile of portfolio
Loans	275,968	209,881
Agricultural production and real estate
Credit risk profile of portfolio
Loans	79,255	51,966
Agricultural production and real estate | Special Mention (Watch)
Credit risk profile of portfolio
Loans	3,096	323
Agricultural production and real estate | Substandard
Credit risk profile of portfolio
Loans	370	282
Agricultural production and real estate | Acceptable and Above
Credit risk profile of portfolio
Loans	75,789	51,361
Consumer and margin loans
Credit risk profile of portfolio
Loans	17,082	9,420
Consumer and margin loans | Special Mention (Watch)
Credit risk profile of portfolio
Loans	681	1,563
Consumer and margin loans | Substandard
Credit risk profile of portfolio
Loans	58	146
Consumer and margin loans | Acceptable and Above
Credit risk profile of portfolio
Loans	$ 16,343	$ 7,711

Loans and Allowance for Loan _6

Loans and Allowance for Loan Losses - Aging Analysis Of The Recorded Investment In Loans (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Aging analysis of loan portfolio
Past due loans	$ 3,217	$ 4,253
Current loans	2,054,910	1,370,407
Loans and Leases Receivable, Net of Deferred Income, Total	2,058,127	1,374,660
30-59 Days Past Due
Aging analysis of loan portfolio
Past due loans	917	59
60-89 Days Past Due
Aging analysis of loan portfolio
Past due loans	282	1,054
Greater Than 90 Days
Aging analysis of loan portfolio
Past due loans	2,018	3,140
Mortgage warehouse lines of credit
Aging analysis of loan portfolio
Past due loans	324
Current loans	337,008	224,937
Loans and Leases Receivable, Net of Deferred Income, Total	337,332	224,937
Mortgage warehouse lines of credit | Greater Than 90 Days
Aging analysis of loan portfolio
Past due loans	324
Residential real estate
Aging analysis of loan portfolio
Past due loans	1,582	728
Current loans	409,289	329,682
Loans and Leases Receivable, Net of Deferred Income, Total	410,871	330,410
Residential real estate | 30-59 Days Past Due
Aging analysis of loan portfolio
Past due loans	579
Residential real estate | 60-89 Days Past Due
Aging analysis of loan portfolio
Past due loans	178	194
Residential real estate | Greater Than 90 Days
Aging analysis of loan portfolio
Past due loans	825	534
Multi-family and healthcare financing
Aging analysis of loan portfolio
Current loans	914,393	529,259
Loans and Leases Receivable, Net of Deferred Income, Total	914,393	529,259
Commercial and commercial real estate
Aging analysis of loan portfolio
Past due loans	550	2,921
Current loans	298,644	225,747
Loans and Leases Receivable, Net of Deferred Income, Total	299,194	228,668
Commercial and commercial real estate | 30-59 Days Past Due
Aging analysis of loan portfolio
Past due loans	245
Commercial and commercial real estate | 60-89 Days Past Due
Aging analysis of loan portfolio
Past due loans	52	860
Commercial and commercial real estate | Greater Than 90 Days
Aging analysis of loan portfolio
Past due loans	253	2,061
Agricultural production and real estate
Aging analysis of loan portfolio
Past due loans	679	458
Current loans	78,576	51,508
Loans and Leases Receivable, Net of Deferred Income, Total	79,255	51,966
Agricultural production and real estate | 30-59 Days Past Due
Aging analysis of loan portfolio
Past due loans	91	59
Agricultural production and real estate | Greater Than 90 Days
Aging analysis of loan portfolio
Past due loans	588	399
Consumer and margin loans
Aging analysis of loan portfolio
Past due loans	82	146
Current loans	17,000	9,274
Loans and Leases Receivable, Net of Deferred Income, Total	17,082	9,420
Consumer and margin loans | 30-59 Days Past Due
Aging analysis of loan portfolio
Past due loans	2
Consumer and margin loans | 60-89 Days Past Due
Aging analysis of loan portfolio
Past due loans	52
Consumer and margin loans | Greater Than 90 Days
Aging analysis of loan portfolio
Past due loans	$ 28	$ 146

Loans and Allowance for Loan _7

Loans and Allowance for Loan Losses - Impaired Loans and Specific Valuation Allowance (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Impaired loans without a specific allowance:
Recorded investment	$ 7,639	$ 4,848
Unpaid principal balance	7,639	4,848
Impaired loans with a specific allowance:
Recorded investment	3,546	2,488
Unpaid principal balance	3,546	2,488
Specific allowance	645	362
Total impaired loans:
Recorded investments	11,185	7,336
Unpaid principal balance	11,185	7,336
Specific allowance	645	362
Mortgage warehouse lines of credit
Impaired loans without a specific allowance:
Recorded investment	251
Unpaid principal balance	251
Impaired loans with a specific allowance:
Recorded investment	324
Unpaid principal balance	324
Specific allowance	225
Total impaired loans:
Recorded investments	575
Unpaid principal balance	575
Specific allowance	225
Residential real estate
Impaired loans without a specific allowance:
Recorded investment	1,606	729
Unpaid principal balance	1,606	729
Total impaired loans:
Recorded investments	1,606	729
Unpaid principal balance	1,606	729
Commercial and commercial real estate
Impaired loans without a specific allowance:
Recorded investment	5,636	4,119
Unpaid principal balance	5,636	4,119
Impaired loans with a specific allowance:
Recorded investment	2,940	2,060
Unpaid principal balance	2,940	2,060
Specific allowance	400	200
Total impaired loans:
Recorded investments	8,576	6,179
Unpaid principal balance	8,576	6,179
Specific allowance	400	200
Agricultural production and real estate
Impaired loans without a specific allowance:
Recorded investment	88
Unpaid principal balance	88
Impaired loans with a specific allowance:
Recorded investment	282	282
Unpaid principal balance	282	282
Specific allowance	20	16
Total impaired loans:
Recorded investments	370	282
Unpaid principal balance	370	282
Specific allowance	20	16
Consumer and margin loans
Impaired loans without a specific allowance:
Recorded investment	58
Unpaid principal balance	58
Impaired loans with a specific allowance:
Recorded investment		146
Unpaid principal balance		146
Specific allowance		146
Total impaired loans:
Recorded investments	58	146
Unpaid principal balance	$ 58	146
Specific allowance		$ 146

Loans and Allowance for Loan _8

Loans and Allowance for Loan Losses - Average Recorded Investment and Interest Income Recognized (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Impaired Loans
Average recorded investment in impaired loans	$ 11,830	$ 4,338	$ 2,394
Interest income recognized	528	183	39
Mortgage warehouse lines of credit
Impaired Loans
Average recorded investment in impaired loans	932
Interest income recognized	59
Residential real estate
Impaired Loans
Average recorded investment in impaired loans	1,485	156	155
Interest income recognized	50	1
Commercial and commercial real estate
Impaired Loans
Average recorded investment in impaired loans	8,872	3,703	2,222
Interest income recognized	375	182	39
Agricultural production and real estate
Impaired Loans
Average recorded investment in impaired loans	489	282	$ 17
Interest income recognized	43
Consumer and margin loans
Impaired Loans
Average recorded investment in impaired loans	52	$ 197
Interest income recognized	$ 1

Loans and Allowance for Loan _9

Loans and Allowance for Loan Losses - Non Accrual Loans and Loans Past Due 90 Days Or More and Still Accruing (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Loan portfolio past due loans
Nonaccrual	$ 1,904	$ 2,548
Total Loans Greater than 90 Days & Accruing	507	592
Mortgage warehouse lines of credit
Loan portfolio past due loans
Nonaccrual	575
Residential real estate
Loan portfolio past due loans
Nonaccrual	893	60
Total Loans Greater than 90 Days & Accruing	74	475
Commercial and commercial real estate
Loan portfolio past due loans
Nonaccrual	136	2,060
Total Loans Greater than 90 Days & Accruing	117
Agricultural production and real estate
Loan portfolio past due loans
Nonaccrual	282	282
Total Loans Greater than 90 Days & Accruing	307	117
Consumer and margin loans
Loan portfolio past due loans
Nonaccrual	18	$ 146
Total Loans Greater than 90 Days & Accruing	$ 9

Loans and Allowance for Loan_10

Loans and Allowance for Loan Losses - Troubled Debt and Modifications (Details) $ in Millions	12 Months Ended
	Dec. 31, 2018USD ($)item	Dec. 31, 2017USD ($)item	Dec. 31, 2016item
Troubled debt and modifications
Number of loans restructured during the last twelve months that defaulted during the period | item	0	0	0
Commercial and commercial real estate
Troubled debt and modifications
Number of troubled debt restructuring	1	1	0
Commercial and commercial real estate | Modification of terms
Troubled debt and modifications
Recorded investment, before modification | $	$ 2	$ 2
Recorded investment, after modification | $	$ 2	$ 2
Residential real estate
Troubled debt and modifications
Number of loans in the process of foreclosure | item	0	0	0

Derivative Financial Instrume_3

Derivative Financial Instruments (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2018USD ($)
Derivative Financial Instruments
Derivative assets, fair value	$ 70
Derivative liabilities, fair value	9
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income
Net derivative gains (losses)	6
Interest Rate Lock Commitments
Derivative Financial Instruments
Notional amount	8,812
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income
Net derivative gains (losses)	70
Interest Rate Lock Commitments | Derivative assets
Derivative Financial Instruments
Derivative assets, fair value	70
Forward Contracts
Derivative Financial Instruments
Notional amount	19,640
The periodic changes in the fair value of the derivative financial instruments on the condensed consolidated statements of income
Net derivative gains (losses)	(64)
Forward Contracts | Derivative liabilities
Derivative Financial Instruments
Derivative liabilities, fair value	$ 9

Loan Servicing (Details)

Loan Servicing (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Loan Servicing
Balance, beginning of period	$ 66,079	$ 53,670	$ 55,553
Paydowns	(4,196)	(5,504)	(4,230)
Changes in fair value due to changes in valuation inputs or assumptions used in the valuation model	1,848	2,950	(3,398)
Balance, end of period	77,844	66,079	53,670
Revenue from specified servicing fee	8,700	8,800	7,500
Escrow funds	412,400	502,700
Originated and purchased servicing
Loan Servicing
Additions	$ 14,113	10,993	$ 5,745
MCS
Loan Servicing
Additions		3,970
Mortgage Loans
Loan Servicing
Sliding scale to deter prepayments (in years)	10 years
Unpaid principal balances of mortgage and other loans serviced for others	$ 5,800,000	5,000,000
Unpaid principal balances of loans sub‑serviced for others	$ 3,100,000	$ 2,000,000

Goodwill and Intangibles - Good

Goodwill and Intangibles - Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Goodwill
Increase in goodwill	$ 13,600
Changes in goodwill:
Balance, beginning of period	3,902	$ 523	$ 523
Goodwill acquired during the period	13,163	3,379
Post-acquisition adjustment	412
Balance, end of the period	17,477	3,902	523
Multifamily
Changes in goodwill:
Balance, beginning of period	3,379
Goodwill acquired during the period		3,379
Post-acquisition adjustment	412
Impairment losses
Balance, end of the period	3,791	3,379
Banking
Changes in goodwill:
Balance, beginning of period	523	523	523
Goodwill acquired during the period	8,163
Post-acquisition adjustment
Impairment losses
Balance, end of the period	8,686	$ 523	$ 523
Mortgage Warehousing
Changes in goodwill:
Goodwill acquired during the period	5,000
Balance, end of the period	$ 5,000

Goodwill and Intangibles - Acqu

Goodwill and Intangibles - Acquisitions, Goodwill (Details) - USD ($)	Dec. 31, 2018	Oct. 01, 2018	Jan. 02, 2018	Aug. 15, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Goodwill
Goodwill acquired during the period					$ 13,163,000	$ 3,379,000
Post-acquisition adjustment					412,000
Multifamily
Goodwill
Goodwill acquired during the period						3,379,000
Post-acquisition adjustment					412,000
Banking
Goodwill
Goodwill acquired during the period					8,163,000
Post-acquisition adjustment
Mortgage Warehousing
Goodwill
Goodwill acquired during the period					5,000,000
NattyMac, LLC | Mortgage Warehousing
Goodwill
Goodwill acquired during the period	$ 5,000,000
FMNBP | Banking
Goodwill
Goodwill acquired during the period		$ 7,200,000
FMBI | Banking
Goodwill
Goodwill acquired during the period			$ 988,000
MCS | Multifamily
Goodwill
Goodwill acquired during the period				$ 3,400,000
Post-acquisition adjustment					$ 412,000

Goodwill and Intangibles - Inta

Goodwill and Intangibles - Intangible assets - (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Intangible assets
Amortization of intangible assets	$ 218,000,000	$ 82,000
Summary
Gross Carrying Amount	4,011,000	1,594,000
Accumulated Amortization	(469,000)	(82,000)
Total	$ 3,542,000	1,512,000
Licenses
Intangible assets
Amortization period	84 months
Summary
Gross Carrying Amount	$ 1,370,000	1,370,000
Accumulated Amortization	(269,000)	(74,000)
Total	$ 1,101,000	1,296,000
Trade names
Intangible assets
Amortization period	120 months
Summary
Gross Carrying Amount	$ 224,000	224,000
Accumulated Amortization	(31,000)	(8,000)
Total	$ 193,000	$ 216,000
Core Deposits
Intangible assets
Amortization period	10 years
Summary
Gross Carrying Amount	$ 2,417,000
Accumulated Amortization	(169,000)
Total	$ 2,248,000
FMNBP | Core Deposits
Intangible assets
Amortization period	10 years
Amortization of intangible assets	$ 85,000
FMBI | Core Deposits
Intangible assets
Amortization period	10 years
Amortization of intangible assets	$ 84,000

Goodwill and Intangibles - Esti

Goodwill and Intangibles - Estimated amortization expense (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Estimated amortization expense
2019	$ 639
2020	619
2021	577
2022	521
2023	462
Thereafter	724
Total	$ 3,542	$ 1,512

Premises and Equipment (Details

Premises and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 29, 2017
Premises and Equipment
Total cost	$ 17,949	$ 8,009
Accumulated depreciation	(2,813)	(2,655)
Property, Plant and Equipment, Net, Total	15,136	5,354
Expected construction cost of new building			$ 17,900
Land
Premises and Equipment
Total cost	3,072	2,260
Buildings
Premises and Equipment
Total cost	4,095	3,140
Building in progress
Premises and Equipment
Total cost	8,272	407
Leasehold improvements
Premises and Equipment
Total cost	83	71
Furniture, fixtures and equipment
Premises and Equipment
Total cost	$ 2,427	$ 2,131

Other Assets and Receivables (D

Other Assets and Receivables (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Investment in Qualified Affordable Housing Limited Partnerships
Investments for qualified affordable housing limited partnerships	$ 17.2	$ 15.6
Additional contribution on qualified affordable housing limited partnerships	1.1
Amortization expense	1.2	0
Tax credit	$ 1.5	$ 0

Deposits - Components (Details)

Deposits - Components (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Deposits
Demand deposits	$ 1,548,969	$ 1,279,145
Savings deposits	1,001,663	1,255,460
Certificates of deposit	680,454	408,956
Total deposits	$ 3,231,086	$ 2,943,561

Deposits - Maturities of deposi

Deposits - Maturities of deposits (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Deposits
Due within one year	$ 648,173
Due in one year to two years	18,062
Due in two years to three years	9,727
Due in three years to four years	2,964
Due in four years to five years	1,528
Total time deposits	680,454	$ 408,956
Certificates of deposit of 250,000 or more	$ 46,700	$ 56,800

Deposits - Brokered deposits (D

Deposits - Brokered deposits (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Deposits
Brokered certificates of deposit	$ 578,471	$ 347,000
Brokered savings deposits	109,607	389,475
Brokered deposit on demand accounts	300,134	205,039
Total brokered deposits	$ 988,212	$ 941,514

Borrowings - Components (Detail

Borrowings - Components (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Borrowings
Total borrowings	$ 195,453	$ 56,612
Lines of credit
Borrowings
Total borrowings	33,150	25,000
Short-term subordinated debt
Borrowings
Total borrowings	10,582	30,000
FHLB advances
Borrowings
Total borrowings	$ 151,721	$ 1,612

Borrowings - Other (Details)

Borrowings - Other (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Apr. 24, 2018	Sep. 25, 2014
Borrowings
Amount outstanding	$ 195,453	$ 56,612
Mortgage loans pledged as collateral	88,100	74,400
Available for sale securities and securities purchased under agreements to resell pledged as collateral	$ 269,300	407,700
Merchants Bank
Borrowings
Ownership in subsidiary (as a percent)	100.00%
Lines of credit
Borrowings
Amount outstanding	$ 33,150	25,000
Short-term subordinated debt
Borrowings
Amount outstanding	10,582	30,000
Short-term subordinated debt | Home point
Borrowings
Amount outstanding	$ 0	30,000
Maximum investment by counterparty in Company's subordinated debt				$ 30,000
Short-term subordinated debt | Home point | LIBOR
Borrowings
Basis spread on variable rate (as a percent)	3.50%
Short-term subordinated debt | Customer
Borrowings
Amount outstanding	$ 10,600
Additional interest as a percentage of earnings	50.00%
Notice period of Non-renewal	180 days
Maximum investment by counterparty in Company's subordinated debt			$ 30,000
Short-term subordinated debt | Customer | LIBOR
Borrowings
Basis spread on variable rate (as a percent)	3.50%
Short-term subordinated debt | NMF | Home point
Borrowings
Additional interest as a percentage of earnings	49.00%
Short-term subordinated debt | Merchants Bank | NMF
Borrowings
Shares of NMF pledged as consideration for investment by counterparty in the subordinated debt of the Company (as a percent)	100.00%
FHLB advances
Borrowings
Amount outstanding	$ 151,721	$ 1,612
FHLB advances | Minimum
Borrowings
FHLB advances interest rate	1.79%	2.27%
FHLB advances | Maximum
Borrowings
FHLB advances interest rate	4.74%	4.74%
Bank | Lines of credit
Borrowings
Maximum borrowing capacity	$ 25,000
Amount outstanding	$ 25,000	$ 25,000
Tier 1 Leverage Ratio (as a percent)	8.00%
Bank | Lines of credit | LIBOR
Borrowings
Basis spread on variable rate (as a percent)		3.23%
Bank | Lines of credit | Minimum | LIBOR
Borrowings
Basis spread on variable rate (as a percent)	1.85%
Bank | Lines of credit | Maximum | LIBOR
Borrowings
Basis spread on variable rate (as a percent)	4.20%
Federal Home Loan Bank | Lines of credit
Borrowings
Maximum borrowing capacity	$ 8,200	$ 0
Interest rate (as a percent)	2.61%

Borrowings - Maturities of FHLB

Borrowings - Maturities of FHLB advances (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Maturities of FHLB advances
Total	$ 195,453	$ 56,612
FHLB advances
Maturities of FHLB advances
Due within one year	149,304
Due in one year to two years	590
Due in two years to three years	77
Due in three years to four years	59
Due in four years to five years	342
Thereafter	1,349
Total	$ 151,721	$ 1,612

Income Taxes - Tax Cuts and Job

Income Taxes - Tax Cuts and Jobs Act (Details) - USD ($)	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Taxes
Statutory tax rate (as a percent)		21.00%	35.00%	35.00%
Additional one-time income tax benefit related to remeasurement of certain deferred tax assets and liabilities	$ 6,900,000
Adjustment of deferred tax assets on unrealized losses on available for sale securities	$ 243,000

Income Taxes - Components (Deta

Income Taxes - Components (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Current tax payable
Federal									$ 13,312	$ 21,413	$ 18,627
State									5,528	3,479	4,477
Deferred tax payable
Federal									1,583	(2,627)	(441)
State									730	212	(995)
Income tax expense	$ 5,699	$ 5,584	$ 5,186	$ 4,684	$ 1,330	$ 6,445	$ 9,091	$ 5,611	$ 21,153	$ 22,477	$ 21,668
Effective tax rate									25.20%	29.10%	39.50%

Income Taxes - Reconciliation (

Income Taxes - Reconciliation (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Income Taxes
Statutory tax rate (as a percent)									21.00%	35.00%	35.00%
Computed at the statutory rate (21% for 2018 and 35% for 2017 and 2016)									$ 17,646	$ 27,006	$ 19,178
Increase resulting from
State income taxes									4,944	2,399	2,264
Effect of Tax Cuts and Jobs Act										(6,928)
Low income housing tax credits									(1,533)
Other									96		226
Income tax expense	$ 5,699	$ 5,584	$ 5,186	$ 4,684	$ 1,330	$ 6,445	$ 9,091	$ 5,611	$ 21,153	$ 22,477	$ 21,668

Income Taxes - Temporary differ

Income Taxes - Temporary differences (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017
Deferred tax assets
Allowance for loan losses	$ 3,366,000	$ 2,216,000
Unrealized loss on available‑for‑sale securities	148,000	442,000
Other	854,000	1,548,000
Total assets	4,368,000	4,206,000
Deferred tax liabilities
Depreciation	(466,000)	(147,000)
Intangible assets	(618,000)
Mortgage ‑ servicing rights	(17,477,000)	(15,548,000)
Limited partnership investments	(2,212,000)	(1,446,000)
Fair value adjustments on acquisition	(3,000)
Total liabilities	(20,776,000)	(17,141,000)
Net deferred tax liability	(16,408,000)	$ (12,935,000)
Federal operating loss carryforwards	$ 800,000

Regulatory Matters (Details)

Regulatory Matters (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Tier 1 Leverage
Amount available without prior regulatory approval for dividends	$ 101,000
Company
Total Capital
Total Capital (to risk-weighted assets), Actual, Capital Amount	$ 393,654	$ 355,722
Total Capital (to risk weighted assets), Actual, Ratio (as a percent)	12.30%	13.70%
Total Capital, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 255,884	$ 207,657
Total Capital (to risk weighted assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	8.00%	8.00%
Tier I Capital
Tier I Capital, (to risk-weighted assets), Actual, Capital Amount	$ 380,950	$ 347,411
Tier I Capital (to risk weighted assets), Actual, Ratio (as a percent)	11.90%	13.40%
Tier I Capital, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 191,913	$ 155,743
Tier I Capital (to risk weighted assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	6.00%	6.00%
Common Equity Tier I Capital 1
Common Equity Tier I Capital 1, Actual, Capital Amount	$ 339,369	$ 305,830
Common Equity Tier I Capital 1 (to risk weighted assets), Ratio (as a percent)	10.60%	11.80%
Common Equity Tier I Capital 1, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 143,935	$ 116,807
Common Equity Tier I Capital 1 (to risk weighted assets, Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	4.50%	4.50%
Tier 1 Leverage
Tier 1 Leverage, Actual, Capital Amount	$ 380,950	$ 347,411
Tier 1 Leverage (to average assets), Actual, Ratio (as a percent)	10.00%	10.90%
Tier 1 Leverage, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 152,081	$ 127,318
Tier 1 Leverage (to average assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	4.00%	4.00%
Federal Deposit Corporation And Federal Reserve Board | Rules Phased in beginning January 2016
Tier 1 Leverage
New capital conservation buffer requirement beginning Ratio	0.625%
Basel III Capital Rules related to CET1, period (in years)	4 years
Additional capital conservation buffer requirement subsequent years Ratio	2.50%
Merchants Bank
Total Capital
Total Capital (to risk-weighted assets), Actual, Capital Amount	$ 412,386	$ 406,638
Total Capital (to risk weighted assets), Actual, Ratio (as a percent)	13.30%	15.70%
Total Capital, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 248,290	$ 207,567
Total Capital (to risk weighted assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	8.00%	8.00%
Total capital, Minimum Amount To Be Well Capitalized, Capital Amount	$ 310,363	$ 259,459
Total Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	10.00%	10.00%
Tier I Capital
Tier I Capital, (to risk-weighted assets), Actual, Capital Amount	$ 399,815	$ 398,327
Tier I Capital (to risk weighted assets), Actual, Ratio (as a percent)	12.90%	15.40%
Tier I Capital, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 186,218	$ 155,675
Tier I Capital (to risk weighted assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	6.00%	6.00%
Tier I Capital, Minimum Amount To Be Well Capitalized, Capital Amount	$ 248,290	$ 207,567
Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	8.00%	8.00%
Common Equity Tier I Capital 1
Common Equity Tier I Capital 1, Actual, Capital Amount	$ 399,815	$ 398,327
Common Equity Tier I Capital 1 (to risk weighted assets), Ratio (as a percent)	12.90%	15.40%
Common Equity Tier I Capital 1, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 139,663	$ 116,756
Common Equity Tier I Capital 1 (to risk weighted assets, Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	4.50%	4.50%
Common Equity Tier I Capital 1, Minimum Amount To Be Well Capitalized, Capital Amount	$ 201,736	$ 168,648
Common Equity Tier I Capital 1 (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	6.50%	6.50%
Tier 1 Leverage
Tier 1 Leverage, Actual, Capital Amount	$ 399,815	$ 398,327
Tier 1 Leverage (to average assets), Actual, Ratio (as a percent)	11.00%	12.50%
Tier 1 Leverage, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 145,723	$ 127,593
Tier 1 Leverage (to average assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	4.00%	4.00%
Tier 1 Leverage, Minimum Amount To Be Well Capitalized, Capital Amount	$ 182,154	$ 159,491
Tier 1 Leverage (to average assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	5.00%	5.00%
FMBI
Total Capital
Total Capital (to risk-weighted assets), Actual, Capital Amount	$ 17,537
Total Capital (to risk weighted assets), Actual, Ratio (as a percent)	18.60%
Total Capital, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 7,559
Total Capital (to risk weighted assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	8.00%
Total capital, Minimum Amount To Be Well Capitalized, Capital Amount	$ 9,448
Total Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	10.00%
Tier I Capital
Tier I Capital, (to risk-weighted assets), Actual, Capital Amount	$ 17,404
Tier I Capital (to risk weighted assets), Actual, Ratio (as a percent)	18.40%
Tier I Capital, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 5,669
Tier I Capital (to risk weighted assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	6.00%
Tier I Capital, Minimum Amount To Be Well Capitalized, Capital Amount	$ 7,559
Tier I Capital (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	8.00%
Common Equity Tier I Capital 1
Common Equity Tier I Capital 1, Actual, Capital Amount	$ 17,404
Common Equity Tier I Capital 1 (to risk weighted assets), Ratio (as a percent)	18.40%
Common Equity Tier I Capital 1, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 4,252
Common Equity Tier I Capital 1 (to risk weighted assets, Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	4.50%
Common Equity Tier I Capital 1, Minimum Amount To Be Well Capitalized, Capital Amount	$ 6,141
Common Equity Tier I Capital 1 (to risk weighted assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	6.50%
Tier 1 Leverage
Tier 1 Leverage, Actual, Capital Amount	$ 17,404
Tier 1 Leverage (to average assets), Actual, Ratio (as a percent)	10.80%
Tier 1 Leverage, Minimum Amount Required for Adequately Capitalized, Capital Amount	$ 6,453
Tier 1 Leverage (to average assets), Minimum Amount Required for Adequately Capitalized, Ratio (as a percent)	4.00%
Tier 1 Leverage, Minimum Amount To Be Well Capitalized, Capital Amount	$ 8,066
Tier 1 Leverage (to average assets), Minimum Amount To Be Well Capitalized, Ratio (as a percent)	5.00%

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Net Income
Net income	$ 15,422	$ 16,739	$ 15,652	$ 15,061	$ 20,329	$ 10,467	$ 14,758	$ 9,130	$ 62,874	$ 54,684	$ 33,127
Dividends on preferred stock	(832)	(833)	(832)	(833)	(833)	(833)	(832)	(832)	(3,330)	(3,330)	(2,002)
Net Income Allocated to Common Shareholders	$ 14,590	$ 15,906	$ 14,820	$ 14,228	$ 19,496	$ 9,634	$ 13,926	$ 8,298	$ 59,544	$ 51,354	$ 31,125
Weighted-Average Shares
Weighted average shares - Basic									28,692,955	22,551,452	21,111,208
Effect of dilutive securities-restricted stock awards									31,464	16,702	2,227
Weighted average shares - diluted									28,724,419	22,568,154	21,113,435
Per Share Amount
Basic earnings per share	$ 0.51	$ 0.55	$ 0.52	$ 0.50	$ 0.73	$ 0.45	$ 0.66	$ 0.39	$ 2.08	$ 2.28	$ 1.47
Diluted earnings per share	$ 0.51	$ 0.55	$ 0.52	$ 0.50	$ 0.73	$ 0.45	$ 0.66	$ 0.39	$ 2.07	$ 2.28	$ 1.47

Stock Splits (Details)

Stock Splits (Details)	Jul. 06, 2017	Mar. 31, 2016	Dec. 31, 2018shares	Dec. 31, 2017shares	Jul. 05, 2017shares
Stock Splits
Authorized common shares			50,000,000	50,000,000	50,000,000
Stock split ratio	2.5	2

Initial Public Offering of Co_2

Initial Public Offering of Common Stock (Details) - USD ($) $ in Thousands	Nov. 02, 2017	Oct. 26, 2017	Dec. 31, 2017
Initial Public Offering of Common Stock
Gross proceeds from offering	$ 115,000
Proceeds from common stock offerings, net	106,200		$ 106,245
Offering costs	$ 8,800
IPO
Initial Public Offering of Common Stock
Shares issued (in shares)		6,250,000
Over-Allotment Option
Initial Public Offering of Common Stock
Shares issued (in shares)	937,500

Private Placement Offering of_2

Private Placement Offering of Preferred Stock (Details) - Private Placement - Preferred Stock - USD ($) $ / shares in Units, $ in Millions	3 Months Ended	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2018	Dec. 31, 2016
Private Placement Offering of Preferred Stock
Shares issued to board of directors for annual fee (in shares)	10,000		31,625
Share price per share	$ 1,000		$ 1,000
Gross proceeds from offering	$ 10		$ 31.6
Net proceeds after offering expenses			$ 31.6
Dividend yield		8.00%

Related Party Transactions (Det

Related Party Transactions (Details) - USD ($)	Jan. 02, 2018	May 08, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Related Party Transactions
Deposits from related parties held by the Company			$ 11,100,000	$ 4,700,000
Percentage of purchase price equal to the price paid by Company’s directors and executive officers, plus expenses and a cost of funds		3.75%
Total assets			3,884,163,000	3,393,133,000	$ 2,718,512,000
Total deposits			3,231,086,000	2,943,561,000
FMBI
Related Party Transactions
Total assets				43,000,000
Total deposits				$ 36,900,000
Key loan processing vendors
Related Party Transactions
Ownership interest as a percentage				30.00%
Fees paid to related party			3,400,000	$ 3,700,000
Amount accrued for services received			226,000	253,000
Law firm
Related Party Transactions
Fees paid to related party			$ 3,700,000	3,000,000	$ 2,100,000
Messrs. Petrie and Rogers | Purchase Agreement | FMBI
Related Party Transactions
Purchase price excluding cost of funds		$ 5,400,000
Amount of cost of funds to be paid for each thirty days after June 30, 2017, proprated to the closing date		$ 16,000
Period for which cost of fund to be raised by company		30 days
Purchase price	$ 5,500,000
FMBI
Related Party Transactions
Total assets				$ 43,000,000

Employee Benefits (Details)

Employee Benefits (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Employee benefits
Matching contribution equals to employees deferrals	100.00%
Employer contributions to contribution plans	$ 464,000	$ 294,000	$ 245,000
Maximum
Employee benefits
Matching contribution as a percentage of employees compensation	3.00%

Share-Based Payment Plans (Deta

Share-Based Payment Plans (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Non executive directors
Plan disclosures
Shares issued	1,830	0
Value of shares available for issuance for compensation related to annual fees	$ 10,000
Expense recognized	$ 50,000
2016 Plan | Restricted stock
Plan disclosures
Percentage of common shares and cash receivable under plan	50.00%
Shares issued	7,039	3,200
Expense recognized	$ 171,000	$ 458,000	$ 57,000
Unvested shares awarded	83,708	66,347
Unrecognized compensation cost	$ 1,100,000	$ 962,000

Disclosures about Fair Value _3

Disclosures about Fair Value of Assets and Liabilities - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($)	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Disclosures about Fair Value of Assets and Liabilities
Trading securities	$ 163,419,000	$ 140,837,000
Available for sale securities	331,071,000	408,371,000
Loans held for sale	11,886,000
Mortgage servicing rights	77,844,000	66,079,000	$ 53,670,000	$ 55,553,000
Derivative assets	70,000
Derivative liabilities	9,000
Recurring
Disclosures about Fair Value of Assets and Liabilities
Trading securities	163,419,000	140,837,000
Loans held for sale	11,886,000
Mortgage servicing rights	77,844,000	66,079,000
Recurring | Interest Rate Lock Commitments
Disclosures about Fair Value of Assets and Liabilities
Derivative assets	70,000
Recurring | Forward Contracts
Disclosures about Fair Value of Assets and Liabilities
Derivative liabilities	9,000
Level 2
Disclosures about Fair Value of Assets and Liabilities
Loans held for sale	820,569,000	995,319,000
Level 2 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Trading securities	163,419,000	140,837,000
Loans held for sale	11,886,000
Level 2 | Recurring | Forward Contracts
Disclosures about Fair Value of Assets and Liabilities
Derivative liabilities	9,000
Level 3 | Interest Rate Lock Commitments
Disclosures about Fair Value of Assets and Liabilities
Derivative assets	70
Level 3 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Mortgage servicing rights	77,844,000	66,079,000
Level 3 | Recurring | Interest Rate Lock Commitments
Disclosures about Fair Value of Assets and Liabilities
Derivative assets	70,000
Treasury notes | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	11,941,000	992,000
Treasury notes | Level 1 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	11,941,000	992,000
Federal agencies
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	236,930,000	374,731,000
Federal agencies | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	236,930,000	374,731,000
Federal agencies | Level 2 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	236,930,000	374,731,000
Municipals | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	21,332,000	6,688,000
Municipals | Level 2 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	21,332,000
Municipals | Level 3 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities		6,688,000
Mortgage-backed - Government-sponsored entity (GSE) - residential
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	60,868,000	25,960,000
Mortgage-backed - Government-sponsored entity (GSE) - residential | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	60,868,000	25,960,000
Mortgage-backed - Government-sponsored entity (GSE) - residential | Level 2 | Recurring
Disclosures about Fair Value of Assets and Liabilities
Available for sale securities	$ 60,868,000	$ 25,960,000

Disclosures about Fair Value _4

Disclosures about Fair Value of Assets and Liabilities - Reconciliation of Unobservable Inputs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Mortgage servicing rights
Reconciliation of significant unobservable inputs, assets:
Balance, beginning of period	$ 66,079	$ 53,670	$ 55,553
Additions
Originated and purchased servicing	14,113	10,993	5,745
Acquisition of MCS		3,970
Subtractions
Paydown	(4,196)	(5,504)	(4,230)
Changes in fair value due to changes in valuation inputs or assumptions used in the valuation model	1,848	2,950	(3,398)
Balance, end of period	77,844	66,079	$ 53,670
Derivative assets | Interest Rate Lock Commitments
Subtractions
Changes in fair value	70
Balance, end of period	70
Municipals
Reconciliation of significant unobservable inputs, assets:
Balance, beginning of period	6,688
Additions
Purchased servicing		6,688
Subtractions
Paydown	(257)
Sales	(6,431)
Balance, end of period	$ 6,688	$ 6,688

Disclosures about Fair Value _5

Disclosures about Fair Value of Assets and Liabilities - Assets and Liabilities Measured at Fair Value on Nonrecurring Basis (Details) - Nonrecurring - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Disclosures about Fair Value of Assets and Liabilities
Impaired loans (collateral dependent)	$ 2,639	$ 2,126
Level 3
Disclosures about Fair Value of Assets and Liabilities
Impaired loans (collateral dependent)	$ 2,639	$ 2,126

Disclosures about Fair Value _6

Disclosures about Fair Value of Assets and Liabilities - Quantitative Information about Unobservable Inputs (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Quantitative information about unobservable inputs
Mortgage servicing rights	$ 77,844,000	$ 66,079,000	$ 53,670,000	$ 55,553,000
Derivative assets	70,000
Available-for-sale Securities	$ 331,071,000	$ 408,371,000
Level 3 | Minimum
Quantitative information about unobservable inputs
Constant prepayment rate (as a percent)	1.00%	1.00%
Level 3 | Maximum
Quantitative information about unobservable inputs
Constant prepayment rate (as a percent)	30.00%	36.00%
Interest Rate Lock Commitments | Level 3
Quantitative information about unobservable inputs
Derivative assets	$ 70
Mortgage servicing rights | Level 3
Quantitative information about unobservable inputs
Mortgage servicing rights	$ 77,844,000	$ 66,079,000
Mortgage servicing rights | Level 3 | Minimum
Quantitative information about unobservable inputs
Discount rate (as a percent)	8.00%	8.00%
Mortgage servicing rights | Level 3 | Maximum
Quantitative information about unobservable inputs
Discount rate (as a percent)	13.00%	13.00%
Collateral-dependent impaired loans | Level 3
Quantitative information about unobservable inputs
Collateral-dependent impaired loans	$ 2,639,000	$ 2,126,000
Collateral-dependent impaired loans | Level 3 | Minimum
Quantitative information about unobservable inputs
Marketability discount (as a percent)	17.00%
Collateral-dependent impaired loans | Level 3 | Maximum
Quantitative information about unobservable inputs
Marketability discount (as a percent)	59.00%
Municipals
Quantitative information about unobservable inputs
Available-for-sale Securities	$ 21,332,000	6,688,000
Municipals | Level 3
Quantitative information about unobservable inputs
Available-for-sale Securities		$ 6,700,000
Measurement Input, Maturity | Interest Rate Lock Commitments | Level 3 | Minimum
Quantitative information about unobservable inputs
Loan closing rates (as a percent)	95.00%
Measurement Input, Maturity | Interest Rate Lock Commitments | Level 3 | Maximum
Quantitative information about unobservable inputs
Loan closing rates (as a percent)	100.00%

Disclosures about Fair Value _7

Disclosures about Fair Value of Assets and Liabilities - Carrying Value and Estimated Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Financial assets:
Loans held for sale	$ 11,886
Carrying Value
Financial assets:
Cash and cash equivalents	336,524	$ 359,519
Securities purchased under agreements to resell	6,875	7,043
FHLB stock	7,974	7,539
Loans held for sale	820,569	995,319
Loans, net	2,045,423	1,366,349
Interest receivable	13,827	8,326
Financial liabilities:
Deposits	3,231,086	2,943,561
Lines of credit	33,150	25,000
Short-term subordinated debt	10,582	30,000
FHLB advances	151,721	1,612
Interest payable	4,132	2,817
Fair Value
Financial assets:
Cash and cash equivalents	336,524	359,519
Securities purchased under agreements to resell	6,875	7,043
FHLB stock	7,974	7,539
Loans held for sale	820,569	995,319
Loans, net	2,041,772	1,364,568
Interest receivable	13,827	8,326
Financial liabilities:
Deposits	3,230,397	2,943,173
Lines of credit	33,150	25,000
Short-term subordinated debt	10,582	30,000
FHLB advances	151,723	1,620
Interest payable	4,132	2,817
Level 1
Financial assets:
Cash and cash equivalents	336,524	359,519
Financial liabilities:
Deposits	2,550,632	2,534,605
Level 2
Financial assets:
Securities purchased under agreements to resell	6,875	7,043
FHLB stock	7,974	7,539
Loans held for sale	820,569	995,319
Interest receivable	13,827	8,326
Financial liabilities:
Deposits	679,765	408,568
Lines of credit	33,150	25,000
Short-term subordinated debt	10,582	30,000
FHLB advances	151,723	1,620
Interest payable	4,132	2,817
Level 3
Financial assets:
Loans, net	$ 2,041,772	$ 1,364,568

Significant Estimates and Con_2

Significant Estimates and Concentrations (Details) - Revenue - Customer concentration - Major Customer - Mortgage Warehousing - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Major Customer
Total revenue	$ 14.3	$ 14.7
Concentration risk (as a percent)	10.00%	15.00%

Commitments and Credit Risk (De

Commitments and Credit Risk (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Commitments and Credit Risk
Commitments to fund loans pending closing	$ 507,000,000	$ 221,300,000
Undisbursed Commitment on construction loans	457,800,000	101,100,000
Outstanding line of credit	782,400,000	613,800,000
Rental expenses	1,100,000	764,000	$ 696,000
Due within one year	1,021,000
Due in one year to two years	1,085,000
Due in two years to three years	736,000
Due in three years to four years	550,000
Due in four years to five years	554,000
Thereafter	426,000
Total minimum lease payments	4,372,000
Commitments to extend credit
Commitments and Credit Risk
Financial instrument whose contract amount represents credit risk	676,987,000	437,585,000
Irrevocable standby letters of credit
Commitments and Credit Risk
Financial instrument whose contract amount represents credit risk	3,164,000	26,000,000
Commitment letters of credit
Commitments and Credit Risk
Financial instrument whose contract amount represents credit risk	$ 19,866,000	$ 31,031,000
Minimum
Commitments and Credit Risk
Lease period	1 year
Maximum
Commitments and Credit Risk
Lease period	7 years

Segment Information (Details)

Segment Information (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Segment Information
Total interest income	$ 39,825	$ 37,577	$ 34,123	$ 29,038	$ 26,910	$ 26,006	$ 22,464	$ 19,007	$ 140,563	$ 94,387	$ 72,939
Total interest expense	15,650	14,095	11,917	8,930	7,958	7,616	6,740	5,476	50,592	27,790	18,968
Net interest income	24,175	23,482	22,206	20,108	18,952	18,390	15,724	13,531	89,971	66,597	53,971
Provision for loan losses	1,608	617	998	1,406	1,400	592	240	240	4,629	2,472	960
Net Interest Income After Provision for Loan Losses	22,567	22,865	21,208	18,702	17,552	17,798	15,484	13,291	85,342	64,125	53,011
Total noninterest income	14,735	11,907	11,630	11,313	14,907	8,056	16,626	8,091	49,585	47,680	28,504
Noninterest expense	16,181	12,449	12,000	10,270	10,800	8,942	8,261	6,641	50,900	34,644	26,720
Income Before Income Taxes	21,121	22,323	20,838	19,745	21,659	16,912	23,849	14,741	84,027	77,161	54,795
Income Tax Expense (Benefit)	5,699	5,584	5,186	4,684	1,330	6,445	9,091	5,611	21,153	22,477	21,668
Net Income	15,422	$ 16,739	$ 15,652	$ 15,061	20,329	$ 10,467	$ 14,758	$ 9,130	62,874	54,684	33,127
Total assets	3,884,163				3,393,133				3,884,163	3,393,133	2,718,512
Other
Segment Information
Total interest income									1,735	721
Total interest expense									(3,285)	(736)	1,187
Net interest income									5,020	1,457	(1,187)
Net Interest Income After Provision for Loan Losses									5,020	1,457	(1,187)
Total noninterest income									(1,946)	(814)
Noninterest expense									9,098	6,188	3,133
Income Before Income Taxes									(6,024)	(5,545)	(4,320)
Income Tax Expense (Benefit)									(1,819)	(1,917)	(1,708)
Net Income									(4,205)	(3,628)	(2,612)
Total assets	30,598				16,855				30,598	16,855	13,453
Multifamily | Operating Segments
Segment Information
Total interest income									712	414	237
Net interest income									712	414	237
Net Interest Income After Provision for Loan Losses									712	414	237
Total noninterest income									45,831	43,715	22,798
Noninterest expense									19,205	10,911	7,474
Income Before Income Taxes									27,338	33,218	15,561
Income Tax Expense (Benefit)									7,528	4,557	6,153
Net Income									19,810	28,661	9,408
Total assets	166,102				134,390				166,102	134,390	98,553
Mortgage Warehousing | Operating Segments
Segment Information
Total interest income									58,784	48,798	43,352
Total interest expense									24,369	13,673	11,235
Net interest income									34,415	35,125	32,117
Provision for loan losses									1,372	452	(247)
Net Interest Income After Provision for Loan Losses									33,043	34,673	32,364
Total noninterest income									2,550	2,836	3,220
Noninterest expense									7,721	7,710	7,730
Income Before Income Taxes									27,872	29,799	27,854
Income Tax Expense (Benefit)									6,872	11,558	11,015
Net Income									21,000	18,241	16,839
Total assets	1,430,776				1,352,748				1,430,776	1,352,748	1,060,723
Banking | Operating Segments
Segment Information
Total interest income									79,332	44,454	29,350
Total interest expense									29,508	14,853	6,546
Net interest income									49,824	29,601	22,804
Provision for loan losses									3,257	2,020	1,207
Net Interest Income After Provision for Loan Losses									46,567	27,581	21,597
Total noninterest income									3,150	1,943	2,486
Noninterest expense									14,876	9,835	8,383
Income Before Income Taxes									34,841	19,689	15,700
Income Tax Expense (Benefit)									8,572	8,279	6,208
Net Income									26,269	11,410	9,492
Total assets	$ 2,256,687				$ 1,889,140				$ 2,256,687	$ 1,889,140	$ 1,545,783

Condensed Financial Informati_3

Condensed Financial Information (Parent Company Only) (Balance sheets) (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Assets
Cash and cash equivalents	$ 25,855	$ 18,905
Total assets	3,884,163	3,393,133	$ 2,718,512
Liabilities
Other liabilities	20,943	13,064
Total liabilities	3,462,926	3,025,659
Total shareholders' equity	421,237	367,474	$ 206,288	$ 148,200
Total liabilities and shareholders' equity	3,884,163	3,393,133
Reportable Legal Entities | Company
Assets
Cash and cash equivalents	2,224	7,273
Investment in subsidiaries	453,028	411,528
Other assets	2,104	5,597
Total assets	457,356	424,398
Liabilities
Line of credit payable	25,000	25,000
Short‑term subordinated debt	10,582	30,000
Other liabilities	537	1,924
Total liabilities	36,119	56,924
Total shareholders' equity	421,237	367,474
Total liabilities and shareholders' equity	$ 457,356	$ 424,398

Condensed Financial Informati_4

Condensed Financial Information (Parent Company Only) (Income statement) (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Expenses
Interest expense	$ 15,650	$ 14,095	$ 11,917	$ 8,930	$ 7,958	$ 7,616	$ 6,740	$ 5,476	$ 50,592	$ 27,790	$ 18,968
Salaries and employee benefits									32,240	21,472	14,313
Professional fees									2,585	1,516	1,298
Income Tax Expense (Benefit)	5,699	5,584	5,186	4,684	1,330	6,445	9,091	5,611	21,153	22,477	21,668
Net Income	$ 15,422	$ 16,739	$ 15,652	$ 15,061	$ 20,329	$ 10,467	$ 14,758	$ 9,130	62,874	54,684	33,127
Comprehensive Income									63,813	54,306	32,731
Reportable Legal Entities | Company
Income
Dividends and return of capital from subsidiaries									37,816	13,632	16,223
Other income									195	208	196
Total income									38,011	13,840	16,419
Expenses
Interest expense									8,055	7,603	7,237
Salaries and employee benefits									1,216	1,617	77
Professional fees									707	341	138
Other									420	251	33
Total expense									10,398	9,812	7,485
Income Before Income Tax and Equity in Undistributed Income of Subsidiaries									27,613	4,028	8,934
Income Tax Expense (Benefit)									(2,542)	(3,670)	(2,885)
Income Before Equity in Undistributed Income of Subsidiaries									30,155	7,698	11,819
Equity in Undistributed Income of Subsidiaries									32,719	46,986	21,308
Net Income									62,874	54,684	33,127
Comprehensive Income									$ 63,813	$ 54,306	$ 32,731

Condensed Financial Informati_5

Condensed Financial Information (Parent Company Only) (Cash flows) (Details) - USD ($) $ in Thousands	Nov. 02, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Operating activities:
Net income		$ 62,874	$ 54,684	$ 33,127
Net cash provided by operating activities		203,590	(175,886)	(149,771)
Investing activities:
Other investing activities		74	189	(295)
Net cash used in investing activities		(509,066)	(523,137)	(265,302)
Financing activities:
Dividends paid		(10,216)	(7,950)	(6,224)
Proceeds from issuance of common stock	$ 106,200		106,245
Proceeds from issuance of preferred stock				31,581
Net cash provided by financing activities		282,481	612,841	413,973
Net Change in Cash and Cash Equivalents		(22,995)	(86,182)	(1,100)
Cash and Cash Equivalents, Beginning of Period		359,519	445,701	446,801
Cash and Cash Equivalents, End of Period		336,524	359,519	445,701
Reportable Legal Entities | Company
Operating activities:
Net income		62,874	54,684	33,127
Adjustments to reconcile net income to net cash used in operating activities		(30,522)	(44,185)	(26,561)
Net cash provided by operating activities		32,352	10,499	6,566
Investing activities:
Return of capital from/(contributed capital to) subsidiaries		19,368	(101,868)	(31,625)
Net cash paid for acquisitions		(27,209)
Other investing activities		74	189	(295)
Net cash used in investing activities		(7,767)	(101,679)	(31,920)
Financing activities:
Net change in short-term subordinated debt		19,418
Dividends paid		(10,216)	(7,950)	(6,224)
Proceeds from issuance of common stock			106,245
Proceeds from issuance of preferred stock				31,581
Net cash provided by financing activities		(29,634)	98,295	25,357
Net Change in Cash and Cash Equivalents		(5,049)	7,115	3
Cash and Cash Equivalents, Beginning of Period		7,273	158	155
Cash and Cash Equivalents, End of Period		$ 2,224	$ 7,273	$ 158

Recent Accounting Pronounceme_2

Recent Accounting Pronouncements (Details)	Dec. 31, 2017USD ($)
Recent Accounting Pronouncements
Stranded tax effects included in AOCI	$ 243,000

Quarterly Condensed Financial_3

Quarterly Condensed Financial Information (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Quarterly Condensed Financial Information (Unaudited)
Interest income	$ 39,825	$ 37,577	$ 34,123	$ 29,038	$ 26,910	$ 26,006	$ 22,464	$ 19,007	$ 140,563	$ 94,387	$ 72,939
Interest expense	15,650	14,095	11,917	8,930	7,958	7,616	6,740	5,476	50,592	27,790	18,968
Net interest income	24,175	23,482	22,206	20,108	18,952	18,390	15,724	13,531	89,971	66,597	53,971
Provision for loan losses	1,608	617	998	1,406	1,400	592	240	240	4,629	2,472	960
Net Interest Income After Provision for Loan Losses	22,567	22,865	21,208	18,702	17,552	17,798	15,484	13,291	85,342	64,125	53,011
Noninterest income	14,735	11,907	11,630	11,313	14,907	8,056	16,626	8,091	49,585	47,680	28,504
Noninterest expense	16,181	12,449	12,000	10,270	10,800	8,942	8,261	6,641	50,900	34,644	26,720
Income Before Income Taxes	21,121	22,323	20,838	19,745	21,659	16,912	23,849	14,741	84,027	77,161	54,795
Income Tax Expense (Benefit)	5,699	5,584	5,186	4,684	1,330	6,445	9,091	5,611	21,153	22,477	21,668
Net Income	15,422	16,739	15,652	15,061	20,329	10,467	14,758	9,130	62,874	54,684	33,127
Less: preferred stock dividends	832	833	832	833	833	833	832	832	3,330	3,330	2,002
Net Income Allocated to Common Shareholders	$ 14,590	$ 15,906	$ 14,820	$ 14,228	$ 19,496	$ 9,634	$ 13,926	$ 8,298	$ 59,544	$ 51,354	$ 31,125
Per common share data:
Basic Earnings Per Share (in dollar per share)	$ 0.51	$ 0.55	$ 0.52	$ 0.50	$ 0.73	$ 0.45	$ 0.66	$ 0.39	$ 2.08	$ 2.28	$ 1.47
Diluted Earnings Per Share (in dollar per share)	$ 0.51	$ 0.55	$ 0.52	$ 0.50	$ 0.73	$ 0.45	$ 0.66	$ 0.39	$ 2.07	$ 2.28	$ 1.47